Reading List: How I Spent My Recession of 2008-2009

While I spent the greater part of 2008 fighting an uphill battle against gas and food prices, the United States slipped into ‘recession’ as defined as 2 quarters of negative GDP growth. (Those that are sticklers for such terminology.) With that in mine, I began the search for whys and hows behind the stock market’s reactions to the housing crisis and the inevitable loss of jobs as business slowed to a George W. Bush’s synaptic firing pace.

 

Money, money, money!!! USA is out of it!

The mid-summer reading list included: Bad Money, The Two Trillion-Dollar Meltdown, Chain of Blame, The Dollar Crisis, The New Paradigm for Financial Markets, and Twilight in the Desert. Each offers insights into the various parts of why America is no longer the country our grandparents thought they built back up to supremacy from Depression in 1945.

 

Bad Money reflects how neoconservatives have made free-market Capitalism a chant from Wall Street to the West Coast mega churches; that debt has become more and more entrenched in our psyche as normal as we use houses as ATMs; and, we have a serious need to monitor what Wall Street is doing as it has more and more complex methods to hide mistakes (and profit wildly in doing so) while manufacturing has disappeared.

 

Could it be more like Eight or Ten Trillion?

Chain of Blame and The Two Trillion Dollar Meltdown are short analyses of what some of the underlying factors were behind the housing crisis of 2007-2008 starting with the 1968 elections of Nixon, gold standard change, 1970’s stagflation, the rise again of Wall Street in the 1980’s, and banking and currency fiascos since that time.

 

Twilight in the Desert describes the politics and the natural resource realities facing America in the near future while we still depend on Saudi Arabian oil and some Middle East stability. (Neither being a good bet.) The process of creating the oil (the gas) we pump thinking it can last forever is discussed quite thoroughly by the investment banker.

Billionaire George Soros clocks in with The New Paradigm, one which he was unusually successful in the pre-financial crisis 2007-08. He determines that markets are neither rational nor efficient. Bubbles need thorough understanding and analysis by economists. It also helps to understand that Soros moves markets via his tongue and rarely does anyone consider his words without an ulterior motive. 

 

Hey brother, can you spare a dime?

As the year went on, and my budget constricted (with trips to Barnes and Nobles vanishing), I turned to ways to make headway in the ‘new global’ economy talked about by Nobel Prize winners in Economics, Joseph Stiglitz (Globalization and Its Discontents) and Paul Krugman (Depression Economics), and a consultant of Wall Street and author, David Smick, of The World Is Curved fame. More knowledge, but also, more confusion as to how to jumpstart America.

The world is definitely something. Just not sure what shape, surface, or idea it truly becoming. But I do need to get ahead in it or else fall off of it.

 

Are you an outlier?

Ahead of the Curve, Bulletproof Your Job, Finding The Work You Love, and Outliers were added to my basket of books to figure out what to do to prevent me from experiencing the next recession as harshly as this one has been all ready. (Christmas I spent all of $75 on gifts. I spent $360 to fix my inefficient car to keep a job in a dying medium: newspapers.)

 

Ahead of the Curve is akin to a Scott Turow’s quasi-One MBA. Harvard is a place to succeed. Nothing else matters much – but partying for MBAs. Philip Delves Broughton MBA journey though lacks drama, but does give one the dryness that is being a corporate clone.

Bulletproof reflects on what all of us should do to be the A performer that has to be inside us in order to keep a job. Stop trying to play grab ass with the stenopool (that’s a dated term) and focus instead on your education and willingness to be a team player always.

Outliers might be the ultimate outlier in this grouping as it just shows what it taking to achieve success through unusual serendipity, timing and birth, and practice, practice and practice.

 

So teacher, that’s what I did on my recession vacation.

Weekend Mega Posts: A Nation of Whiners and John Hancock

Since I last left the building, a few things have happened:

A Nation of Congressional Idiots, Sir.

Former Texas Senator Phil Gramm called us a “Nation of Whiners.” I wonder why, sir. I wonder why a man who has been a key ingredient in the mixing bowl of economic disasters, from Enron’s rise and fall [wife tied to that mess] to a lobbyist in the subprime arena at banking giant UBS would be so utterly contemptuous as to say, “we are a nation of whiners.” Yes, we complain. About 4,100+ troops dead on a battlefield of disgraceful miscalculation and subterfuge. We complain about the billions in taxpayer’s money spent funding that war of idiocy and ideology. We complain that our infrastructure, schools and healthcare are much less that ideal, unless you make a significant salary, get bennys and can spend your off time dabbling in the stock market, that’s off 20% from it’s highs.

That you are complicit in this whole economic malaise might not be so troubling if it were not the fact, now, you are implicitly blaming us, the victims of this mess. That our nation is in the early-middle, not the end, of this current fallout, one triggered by idiot politicians, like you, that dropped the regulatory ball, former federal reserve Alan Greenspan’s ultra-low interest rates in the wake of 9/11 which gave way to a train of abuses in offering loans to under (and unqualified) applicants and this whacked idea that you can spend thrift in a time of war, lower taxes and just not hurt us economically. (Value of the U.S. Dollar anyone???) But you, sir, are a twit. Leading a septuagenarian’s campaign to nowheresville. Hocking us and hocking America right down the drain. Sure, your well-educated, well-to-do and wealthy-to-no end golf buddies and fav 5 additions are tickled pink-o to be at the trough of these ‘fast money’ ideas. To just forget the details of how to build a logical and trustworthy financial system is Bad Money policy.

Read up here on the debt, economy and a train of abuses...

Meanwhile, we are back to the future. You remember 1987? Bailing out savings and loans? I was 15 – and understood that wasn’t something to be happy about. But the seeds of that fiasco were sown in a multitude of policy gaffs – like now, Dr. Phil Gramm.

If you do read Bad Money by Kevin Phillips (I read the first 150 pages), you will get (from reviews):

• In the last 30 years, financial services have grown from 11% of GDP to 21%, and manufacturing has declined from 25% to 13%.
• in the last 20 years public and private debt has quadrupeled to $43 trillion.
• Cognizance of our problems has been somewhat covered up with revisions to the CPI (understating costs of home ownership) and unemployment measures (not counting those who gave up and quit looking). Thus, the 2-4%/year CPI increase 2005-2007 would have been 5-7%/year, and unemployment would have been 8%.
• OPEC has reduced its foreign-currency reserves held in dollars from 75% to 62.5%, and Iraq and Venezuela began selling oil in euros and yen (admittedly for political purposes, at least at first). Meanwhile, the U.S. has antagonized major oil producers (Iran, Russia, Venezuela), and effectively dismantled Iraq - raising the risk of nations being unwilling or unable to supply the U.S. as supplies grow tighter
• That securitized debts or CDOs (collaterilized debt obligations) were sold and resold throughout the global financial system and no longer did anyone know how to measure their value or their risk. Add to this the fact, that homeowners were using the rising equity of their homes as atms and pumping another $4 trillion into the economy.  Also add to the mix $700 billion annual trade deficit that indicates that much more consumption over production.

These are but a few of my favorite highlights, Dr. Phil.

That over the past 30 years, America, has been sold like a slave in the common market. We aren’t stupid or ignorant. Unfortunately, those in power stay in power because the spine needed to stop their abuses is not readily present. That our will is shattered because you forgot that this is America.

Many here won’t get rich, or have multiple homes or send their kids to some private brainwashing school, but instead will be working 50 hours a week for 50 years of their lives and might get a death bed at the nursing home. It will be their American Dream because they hope for more, and sometimes, might have received it.

 But That’s the problem.

If only John Hancock could see us now.