I love history.
Not history served up in High School, but family history, local history, history not re-written and filtered through politically correct nonsense.
Last night I was in the mood to learn more about The Prohibition. We’d watched Ken Burn’s three part series on it recently, then heard an author talk about the Prohibition in Iowa.
Settled on The Crash of 1929, compliments of Amazon Prime.
I had to pause the show at one point and write this down:
“There was nothing unique about this. (financial collapse) It happens every 20 to 30 years. That is about the time of people’s financial memory, until a new set of people capable of wonderful self-delusion comes along…“
If you’ve been reading this blog the past year, you know we have had our share of financial stress.
In my case, it wasn’t credit card debt, rather a naivety about money management in general.
Currently, while many of us are experiencing financial stress, on a purely creature comfort level, we have not experienced as a nation the suffering after the stock market crash of 1929.
Could it happen again?
I need to put this out there, there is so much hype out there on a coming economic collapse.
I’m currently in my mid 50’s. Three of my grandparents lived into their late 90’s. The odds are within the next 40 years something profound is going to break/ pop/ shift in our economy.
I refuse to get caught up in any of that “Wonderful self delusion.”
If you were standing 5 feet away from a 1000 ft deep sink hole, and you felt a little fear in the pit of your stomach, that would not be a sign of weakness…I would suggest listening to that little voice inside your head telling you to “step away” and put some distance between you and that hole.
Side note; In 2008 we had $3000 in an on-line Vanguard account. Then came the stock market jitters of 2008.
Vanguard put a freeze on all of our money for 30 days. They did this to calm the market, so as to prevent a good old fashion run on the banks, or in this case, run on an investment company, where people panic, pull their money out, and the whole house of cards collapses.
As a student of history, don’t think that didn’t set off a few alarm bells….
The difference today and 1929 is, the whole banking, investment and financial institutions in general, are interwoven with our federal government. ie. The government of the United States has in effect said they will prop up banks that in the past would have failed.
Now that does not give me warm fuzzies, and here’s why. Our own government is living on borrowed money. Trillions of dollars worth. So who is going to bail the Government out when it goes belly up? The last few years, “the experts” decided to print billions of dollars of funny money to prop up the stock market, prettied it up with the title “quantitative easing.”
Just make up a fancy name and some people will trust you know what you are doing.
Here are some links to the history of financial upheaval in America:
Here is a great website that unpacks past financial panics, depressions and economic turn-down without a lot of hype.
If you want to read more:
Family picture of my grandma coming to America on a boat to escape the economic collapse of Germany in about 1928. (She’s second from the right)
Practical thoughts, comments, questions on how to “step away”?