I was listening to the radio a while back.
Financial talk show host Bob Brinker was discussing memories of dropping stock markets in 1973-74. Also the fraudulent failure of some big equity firm back then.
Similar to the Madoff debacle of recent times.
Yes, it seems like each generation has it's financial meltdown. Promises made for investments and retirements are often lost just before being realized.
One hears advise of how they should invest early in life. Use the power of things like compound interest to realize huge sums in retirement years.
The math works on paper, but in reality vast savings still must rely on a productive economy. An economy of resources, goods and services. Investments must rely an economy where future generations are doing commerce. Otherwise they are nothing more than good looking numbers on brokerage statements.
For investments to be real, future businesses need to have customers. Future houses need buyers who can afford the mortgages. Future people need to be able to afford rents and lease payments. Otherwise the real world manifestations of these investments are little more than "white elephant shopping malls" looking for tenants.
Government debt is, of course, considered the most secure investment of all.
That's ironic.
Government provides valuable services, but as an investment, it seems unable to collect the taxes needed to pay back it's deficits. This problem just gets worse as we live in the "post California Prop 13 years." Politics will cap tax revenues. Also, if business isn't making money, the revenue isn't there anyway.
It looks like each generation lays up wealth only to see disappointment before the promises pay.
Saving is a good idea, but one shouldn't put all their self worth into money.
I've never had a lot of money and, so far, the current downturn hasn't impacted my life that much. Glad I'm still working and the place I'm working at is doing well.
Quite a few people, in my postwar baby boom generation, have seen the vast savings they worked for disintegrate.
Some baby boomers may look at today's young folks with envy.
Today's young folks riding by on skateboards with smiles on their faces. They still have plenty of time before worry about retirement and maybe the "system" will be fixed by then.
I still try and live with a smile on my face. I ride my bicycle even though I have never mastered skateboarding.
Some people say, my life is kind of Peter Pan like.
I'm actually enjoying life now more than I did in college, though.
Back in the recession of the 1970s, when a past generation was loosing much of it's retirement, I was worrying that our dorm dining halls would start serving pet food for dinner.
Why pet food? To save money.
The company that ran our dining halls was already locked into it's contract for the year. Revenue was fixed, but food costs kept spiraling up. I worried that they would have to resort to cheaper and cheaper food until, by spring, they'd be opening cans of cat food.
Yuck.
Canned cat food would be real yucky, pasty and scummy. The dried "Little Friskies" might be better, but still not real good.
As it turned out, the food was good all the way to the end of the contract year. No need to resort to such drastic measures.
It was mostly a scenario I had dreamed up.
Most of my life has been enjoyable, but haunted a bit with this kind of worry.
It seems like many economic promises that are made can't be sustained. This has happened before in history. Sometimes not as bad, other times maybe worse.
I just hope that the future will be, at least, be reasonable.
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