So says former Goldman Sachs head:
Whitehead, 86, said the prospect of worsening consumer credit woes combined with an overtaxed federal government make him fear that the current slump is far from over.
"I think it would be worse than the depression," Whitehead said. "We're talking about reducing the credit of the United States of America, which is the backbone of the economic system." Whitehead encountered plenty of crises during his 38 years at the investment banking firm and was a young boy during the 1930s.
Most experts still don't know what caused the Great Depression. Fewer than 1% of experts predicted the current market meltdown. Most are still figuring out what happened. I am so over the "experts."
One thing I've noticed is that everyone is freaking out - even my rich friends. I don't get this. Unless there is literally blood in the streets, most of us will survive the coming Depression.
Yes, this might mean standards of living will drop. Friends might start sharing homes and mortgage payments. We live a few blocks from the beach - and our rent reflects that. If we need to move inland (or share space with good friends who live in house with a spare bedroom), then that's what we'll do. Life won't be jolly, but it will be fine.
The consumptive lifestyle will end. But most readers of this blog will be fine.
The working poor, however, will be screwed. How screwed? Who knows, really. But if things for them get really bad, then there might indeed be blood in the streets.
People are forgetting population growth. There are at least 300 million people living in America. During the Great Depression, there were 120-130 million Americans. That's a lot more hungry mouths to feed.
Moreover, the working poor are more violent today than they were generations ago. The working poor aren't farmers from Kansas. Many parts of the country would look like the L.A. Riots.
While there will be major problems in the market, it's hard to imagine civilization completely failing; though that's probably what the Romans said.
Still, it's prudent to hedge against a catastrophic event. Everyone really should have a 12 gauge shotgun or a pistol that she knows how to use. If you're in a rural area, you should have a rifle, too.
Will you ever need to use your gun? Almost certainly not. Will you ever need to use your fire insurance? Against, almost certainly not.
Yet you have fire insurance, but not a gun? It's interesting how society brainwashes us, isn't it? We are told to hedge against some unlikely events (fire), but not others (home attack).
Yes, guns offer some dangerous. Who says otherwise. Which is why you should keep the damned things locked up.
Incidentally, it's much more likely that you'll die in a car wreck than from a gun. You don't hear people saying, "I'm so afraid of my car. I will only drive to work or when absolutely necessary. But not for anything else, especially leisure activities. Driving is so dangerous." But God help you if you try bringing a gun into your home!
