I just heard that 2 days ago 499 of the top 500 stocks went down. Campbell's Soup was the 1 that went up. I just had to laugh since just today I was thinking, "Man I need to ramp up my food storage ASAP!" And Campbell's is an obvious food storage staple. Inexpensive, condensed so it doesn't take up much space, and not half bad.
So, I've been trying to follow this whole Economic Disaster thing. It's hard to keep my head even somewhere near the surface. Macroeconomics and banking is fairly mystifying to me, so I've tried to educate myself somewhat.
How did we get here?
Well, there's a good share of finger pointing going on right now. The housing foreclosures are often blamed, but what caused those?
I found this article to be interesting. It basically blames the governmental push (under the Clinton administration) for "affordable housing" and "packaging the American dream" for everyone regardless of credit history or money saved. No money down. Risky Loans. $1 Trillion in Sub-prime Mortgages. The author goes on to say that Bush tried to overhaul the housing finance industry in 2003 warning that Freddie and Fanny were facing a financial crisis. Obviously that never happened and no one took him seriously.
There may be more to this story (probably is) than I know, but it sure is interesting to think about. Clinton's always been praised for the good economy while he was in, and Bush has been blamed for the bad economy while he's been in. The economy's not necessarily a direct result of the leader currently in command.
To bail or not to bail?
As of now (can't guarantee I'll agree with this tomorrow), this bail out seems bad for the long term. It may help for a little while, but I think I agree with this forecast. If we go through with the bail out, it will weaken our dollar. Our gas, food, and recreational purchases will all continue to rise, and we should probably be added to the list of socialist nations like Cuba, China and North Korea. As the author said in the forecast link, "Similar to recessions, market corrections clean the system of sewage, enabling it restart a period of positive gains. As long as the Fed continues to try to mitigate what must naturally occur – a complete recession - we will be treading water, setting the stage for a much bigger crisis down the road."
How will it really affect me?
Unfortunately there are a lot of people who will lose their jobs. If Obama wins this election, I imagine there will be some layoffs at Matt's work since his company does defense technology under government contracts. While Matt's current project does help military, we're lucky that The Predator serves other purposes. He also is the only software guy on this project. So, I can't forsee him losing his job in the near future. But who knows really?
I think the best bet for anyone would be to prepare for the worst. Save money. Ramp up food storage before food prices go even higher. Learn how to garden. Learn to cook and eat out less. Learn to make do (oh this is so hard sometimes!). Oh, yeah, just do what the Prophets have been telling us the last 40 years or so...
Things usually get worse before they get better. Might as well be prepared for that I think. At least then we'll have [nothing? less?] to fear.