A word of warning: I’m not an economist. I’m pretty terrible with money in general. So, the observations I’m making are less about the fundamentals of the economy, but rather my observations from a historical perspective, which I do have a degree in.
Historical Implications
From the historical side of things, you zoom out far enough and a lot of patterns begin to manifest themselves. Those patterns are sometimes just patterns. And sometimes, they aren’t entirely accurate. But it seems to me that we have a huge problem, and it’s not going away. Since globalization, we have constructed a machine with two modes: boom and bust.1
In other terms, businesses see these booms and busts as expansions and contractions, and you can see the data lay these out over decades of United States history.2 What strikes me the most in either of these term sets is how little they take into account… ya’ know: people. It’s like we have this invisible force just growing and shrinking. Don’t worry about it. It’s just the way things are. There’s nothing you can do about it.
We grow our economies without any consideration for the future, then we watch them implode, sometimes to disastrous effect (think Great Depression, Great Recession levels of effect).
Can we just have a laugh over this idea that we had a ‘Great’ Depression. Like, wow: such great. The other issue with a historical perspective is that things become so macro in scale, that we lose sight of the people who lived through these horrid times.
Also, when we see these cycles as invisible forces, it creates this pervasive lack of accountability to the parties who make them happen. You can’t have a booming economy without a select set of business interests lighting the powder keg, and then they just hope to get out before it goes off. In fact, usually these guys are the ones getting rescued after they’ve watched it blow up while they stand there with matches in-hand!3
Up and to the Right… Forever
During a boom, people have this sense that things will always be “up and to the right”. What do I mean by that? Up and to the right is like looking at a line graph, where over time, profits continually rise. But just like my puny retirement account, the story is just not there. We rise. We fall. And yet, we are shocked every time. And we shrug as the next big economic boom wipes our memories like a brain neuralyzer from Men in Black.
I don’t know about you, but I find this never-ending race to the top-right exhausting. We just need more and more and more. It never stops. Even when we are in the hard times - those cycles of contraction - we are looking for the ‘way out’. How can we make some dinero and get ourselves into a great spot for the next boom?
In Search of Community
I felt like, after COVID, we had learned something. Life is precious. Maybe the pursuit of more was finally put into its proper perspective, and we could see that communities were more important than markets.
But here we are again staring down the barrel of another recession, crazy housing prices, and myriad of other economic landmines exploding in unison.
As a good friend, said recently: the only way through will be together.4 And my good buddy,
, has been writing about community as well over at . I do believe we are in desperate need of community, and that the ties between people are what will save us from our lust for more. Maybe it would do us some good to wander and meander our way through rather than obsess on up and to the right?
Source: Investopedia
Source: thebalancemoney.com
Thanks, Gina!