Sports journalist E.M. Swift is fond of noting that whenever an underdog team was doing well, his phone would ring. The question was always the same: could this team create another moment in time that could become the next“Miracle on Ice.” His answer was always the same: “There’s never going to be another Miracle. You just can’t get all the things to line up the way they did in 1980.”
In readingthis piece on our rather precarious financial standing, I found it interesting that Eichengreen always took the same kind of stand whenever we saw the dark side of capitalism. Could there be another Great Depression? Nah. Things can’t line up like that again. Given his more recent penchant for hiding under his bed when reporters are calling these days (maybe he’s fearing some “gotcha journalism”), we’ve got reason to fear.
This is perhaps the best explanation as to how the economy managed to get screwed to this point. The part on credit default swaps is particularly enlightening and yet frightening. There hasn’t been this big of a set ofentangling alliances since World War I.
When something turns out OK, people who were worried are called “alarmists.” When people complain that nothing was done, they’re called “pundits.” What do you call the people who are right on the money, screaming at the top of their lungs to inform us that the ass end of Hell is opening up and preparing to swallow life as you know it in one giant gulp? What do you call it when people say, as they did Thursday“get me out at any price.” I’d call it fear, panic and desperation. I’d also call it the tip of the iceberg.
No one wants to say the “R” word or the “D” word, but let’s call it what it is: The greatest financial crisis since the time of Herbert Hoover. Maybe the pieces didn’t line up exactly like they did in 1929. Maybe there aren’t ration stamps like in the 1940s. Maybe we don’t have gas lines and 20-percent interest rates like we did in the 1970s. That doesn’t mean we’re any less screwed.
On the plus side, the hockey season just opened.
I’ll be looking for another miracle or a close facsimile thereof.