Higgenbotham's Dark Age Hovel

[spottybrowncow]

I enjoyed watching the SpaceX launch last night - especially when the legs opened at precisely the right instant before touchdown. I almost get a little emotional thinking about all the brilliant men and women working so enthusiastically to make this "magic" happen. When I see a shot of SpaceX employees cheering, they look pretty diverse to me, but Musk does it by merit, not DEI. I find it to be a very positive inspiration for how all of society could be.

Interestingly, a search for this event on MSNBC.com yielded nothing. I guess I'm not surprised. Their viewership doesn't want to see anything portraying Musk or Trump in a favorable light. They'd much rather stay in the dark with their bogeymen.

I'm going to stop short of saying some of them probably wanted the mission to fail. Surely they're better than that.

[Higgenbotham]

This is from a newsletter I get, so there is no link.

From a cyclical perspective, five key cycles are either topping or already in down phases. This confluence of
bearish cycles sets the stage for a crash. The 19-year stock market cycle peaks this year, along with the 11-year
sunspot cycle – refer to Federal Reserve Bank of Atlanta working paper 2003-5b, Playing the Field: Geomagnetic
Storms and the Stock Market (Krivelyova and Robotti, 2003) for details. The 3.5-year cycle peaked in December
and is already evident in the reversal of AAII bull-bear sentiment (top of page 10). The seasonal cycle is especially
bearish and associated with market crashes in two months – March and October. Finally, the Eclipse Cycle
(bottom of page 10) reaches its most bearish phase in the two weeks following the March 14 lunar eclipse. Thus,
based on the collective evidence, the probabilities remain high that the developing liquidity crisis will begin to
snowball out of control sometime next week. The confirmation will come when the major averages clearly break
below all trendlines and support levels, and trading volumes soar well above recent levels. When that happens,
margin calls will skyrocket and forced sales in increasingly illiquid markets will cause stocks to crash massively.

[Higgenbotham]

Consumers and Businesses Send Distress Signal as Economic Fear Sets In
Canceled trips, fewer dinner parties and falling sales: ‘We are cutting back on virtually everything’
By Rachel Louise Ensign, Natasha Khan and Ruth Simon
Updated March 15, 2025 12:01 am ET

https://www.wsj.com/economy/consumers/c ... n-f58d0659

Consumer Angst Is Striking All Income Levels
Signs of weakness are showing up in spending on everything from basics to luxuries
By Jinjoo Lee
Updated March 13, 2025 10:14 am ET

https://www.wsj.com/economy/consumers/c ... s-ab32d5d5

[Higgenbotham]

I enjoyed watching the SpaceX launch last night - especially when the legs opened at precisely the right instant before touchdown. I almost get a little emotional thinking about all the brilliant men and women working so enthusiastically to make this "magic" happen. When I see a shot of SpaceX employees cheering, they look pretty diverse to me, but Musk does it by merit, not DEI. I find it to be a very positive inspiration for how all of society could be.

Interestingly, a search for this event on MSNBC.com yielded nothing. I guess I'm not surprised. Their viewership doesn't want to see anything portraying Musk or Trump in a favorable light. They'd much rather stay in the dark with their bogeymen.

I'm going to stop short of saying some of them probably wanted the mission to fail. Surely they're better than that.

The way I put it early on in this thread was, "These influences WANT a dark age. It's all they know and understand." Based on what I see, they will probably get what they want.

[spottybrowncow]

Higgy,

When suicide bombing became a big thing, I tried to "get inside the mind" of a suicide bomber. I read many things, trying to understand. I was ultimately unsuccessful, I could never understand what made people do that. Sadly, I now find myself equally unable to get inside the mind of the radical progressive leftist. What makes these people tick? Is there a diagnosable illness? I just don't get it.

[Higgenbotham]

Going back in my lineage, the only person who could have advised me on how to avoid these dependencies would be my grandmother, who was born in 1902 in rural Nebraska. According to my father, she had bred a tomato (heirloom in today's lingo) that grew well in her area. She saved seed and started her plants, surely without seed starter mix or fertilizer or grow lights.

Jean Luke Borol is one of
18:19
the last Artisan seed sellers in the
18:25
country using his own Tomatoes he produced say no none hybrid seeds these are heirloom
18:57
seeds for
19:30
in his Greenhouse Jean Luke only grows Farmers
19:36
varieties 100% natural
19:43
farming
20:12
do these Farmers varieties contain more nutrients than hybrids we are going to
20:18
analyze them on one side we have Jean Luke's
20:27
tomatoes on the other a hybrid with a similar appearance bought from the
20:38
supermarket the very same day we sent them to an accredited laboratory to measure their nutrient
20:48
levels 3 weeks later the results arrive
20:54
the hybrid tomato contains a significantly lower level of the five nutrients
21:01
analyzed it contains 63% less calcium 29% less magnesium and 72% less
21:09
vitamin C the levels of lycopene and polyphenols two
21:15
antioxidants that help fight cardiovascular diseases are two times lower in the hybrid than in the farmer's
21:22
variety tomato.

https://youtu.be/8uwn7ioUHTk?t=1260

The video is long (50 minutes). It gives the reasons why this is the case.

The video is one-sided. Not all hybrids are bred for long term storage at the expense of nutrient content. At least I don't think so. But the data that is presented is probably accurate as far as it goes. It's a source of nutrient depletion that hasn't been mentioned in this thread previously.

For example, one of these hybrids is out back (out of 17 plants in the ground). This is a fine variety in my opinion. But at the same time, I am growing a few heirlooms and saving the seeds.

The Celebrity tomato is a hybrid tomato variety, specifically a first-generation (F1) hybrid, known for its disease resistance, high yields, and dependability in less-than-ideal growing conditions.

Here's a more detailed breakdown:

Hybrid Nature:
The Celebrity tomato is a result of crossing two inbred tomato plants with desired traits, creating a hybrid variety.
F1 Hybrid:
It's a first-generation hybrid, meaning it's the direct result of the cross-pollination of two purebred parent plants, and the seeds from this first generation will not produce the same characteristics.

Characteristics:
It's known for:
Disease Resistance: Resistant to multiple diseases, including tobacco mosaic virus, Verticillium wilt, and Fusarium wilt.
High Yields: Produces a heavy yield of tomatoes.
Dependability: Thrives in a wide range of conditions, including high and low temperatures.
Flavor: Known for a classic, full tomato flavor.
Crack Resistance: The fruits are known to be crack-resistant.
Plant Type: It is a determinate tomato, meaning it grows to a certain size and produces fruit for a specific period.

All-America Selections Winner:
The Celebrity tomato was a winner in the 1984 National All-America Selections (AAS) for edible vegetables.

We started the week at 38 degrees on Monday morning and ended the week Friday afternoon at 97 degrees. This variety may be the winner this year if that keeps up.

[Higgenbotham]

This is verbatim from my sister yesterday.

He walked into a place near where he lives and got hired today - $4 more an hour, can work any hours he wants - 12 hour shift - 10 minutes from home - starts April 1. He got an interview instantly and a tour. He was dressed up.

I asked her to verify that the account below is accurate in her recollection. She said it is. In the second quote, it's just the paragraph at the bottom, but the rest of it provides background.

When I advised my sister that he become a nurse, I told her that with all the gender confusion and social engineering, she might be surprised as to what a good reception this young white male might get upon making a decision to enter the nursing field. I said look at Google and this ridiculous James Damore incident where that pathetic clown Sundar Pichai said it's not OK for Damore to point out that there are gender differences in proclivities and abilities. You have all of these high tech companies wanting to recruit women to do what are basically men's jobs and it didn't surprise me that the opposite situation might exist. That is in fact the case. My sister told me she even heard some of the older black and brown women in his workplace oohing and aahing over him, saying things like what a nice young man he is, so polite, etc.

Do companies pass over students who seem “too good/smart”?

My good friend (21M) is a junior in chemical engineering right now and has been applying to a ridiculous amount of internships and co-ops because he hasn’t been getting any interviews. He is literally the smartest student in our program, this guy is a human calculator/dictionary/etc.. of course he has a 4.0 gpa. He’s also an officer for AIChE and is a chem-e car co-captain, which is a lot of work. He is an undergrad researcher at the college too. He actually does a great job with everything he’s involved in. He’s good with people, which I find interesting because usually people as smart as him are awkward. Like this nerd literally taught himself numerical methods over the summer for FUN.

It makes no sense why he hasn’t gotten at least a few interviews. He’s ridiculously intelligent, personable, organized, very hard working, has leadership skills and research experience. I just don’t understand why he isn’t being considered for jobs and it’s paining me to watch him lose hope in getting a job.

I already have an internship offer and he deserves one more than me. I also helped him work on his resume in the hopes that rewording it would make it scan better. He’s tried writing cover letters too.

The only thing I can think of is that maybe he’s one of those students who seems “too good” or “too smart” so companies assume he’ll just be going to grad school and isn’t a good choice for a program that prepares interns for a full time job.

I really want to help him but I don’t know what else to tell him at this point. Not trying to job hunt for him or get resume tips, I’m just at a loss. Any input at all is welcome and appreciated.

EDIT: Thank you guys so much for your help!! This has really helped clear up a lot of things for my friend and now he has a good idea of what to go moving forward. We both appreciate everything!

https://www.reddit.com/r/AskEngineers/c ... _seem_too/

This post is 5 years old, but anything along these lines written in the past 40 to 50 years would be applicable to the topic. It's a good post for illustration purposes because it got 157 responses, many from HR people and engineers who recruit. They mostly gave responses along the lines of what people would perceive as to "what's wrong with this guy" or "what this guy is doing wrong". Some examples I can recall are: he may be arrogant, he may not be well rounded, he may not have "soft skills", he may not be writing enough cover letters, etc.

The real reason this young person had not found a job yet is that we are in the maintenance phase of a declining civilization.

It's because we've been in the maintenance phase of a declining civilization since the 1970s.

Also, I think that once the numbers of births start to decline, that is the point at which the rate of physical expansion of the civilization also starts to slow down and, therefore, traditional male activities like building infrastructure begin to decline and the civilization enters into a maintenance phase before the inevitable decline. The mix of jobs begins to change and women are able to better do many of the jobs that become prominent during the maintenance and decline phase (like health care and education, which really just serve to milk out the surplus of the civilization before it collapses). This shift in the job mix has the effect of accelerating the decline (further reducing births and the effects that result from the further reduction in births).

My nephew is a little bit like the guy described in the Reddit post. He is 23. About the time this Reddit post was made, my sister asked me what my nephew should do. I told her, odd as it may seem, my opinion was that he should go to school to become a nurse. He did, and he makes over 100K per year already (with overtime). He was never assumed to be arrogant because of his high grades, he was never accused of not being well rounded, it was not thought that he might not have "soft skills", and he never wrote a cover letter. He was hired on the spot. He was hired basically to do maintenance in a declining civilization.

She also commented that he has "soft skills" - he's willing to be "helping with wiping ass and giving people dignity" and his high grades show that he is conscientious.

More background on the topic:

I haven't given my take on Boeing except to say that in the early 2000s there was a contingent of engineers within Boeing who believed management was leading the company down the tubes and one in particular who may have used that experience as the seed to start a collapse blog after he retired.

Beyond that, I don't know a great deal about Boeing in particular.

I've mentioned in these pages that somewhere around 1971, give or take a few years, and it would vary from sector to sector with probably the more complex sectors coming first, that the US entered the maintenance phase of a declining civilization. There was a slow recognition and response to that turning point. Boeing would be more complex from an engineering standpoint than the average sector. Like the Boeing engineers said, they're not making washing machines, toasters or clock radios.

More than 40 percent of those with a B.S. degree in engineering work in non-engineering-related jobs. And as many as 25 percent of new graduates consider careers outside engineering. A study led by Sheri Sheppard, associate vice provost for graduate education at Stanford University, cites the “troubling trend” that, over the past two decades, “the highest-performing students and graduates are leaving science and engineering pathways at higher rates” than lower-performing peers.

https://newprism.asee.org/checkered-careers-jan/

The underlined sentence is what would be expected when the US is well within the maintenance phase of a declining civilization which, according to the article, has been the case since about 2003, the same year the Boeing engineers wrote the letter posted above. In addition to what's in the underlined sentence, it would also be expected that students with the highest aptitude for engineering won't bother to enter the field because there is nothing in it for them.

So while Boeing engineers may not be making washing machines, toasters, or clock radios, Boeing is also not looking to make the next great leap in aviation, comparable to the 1960s when Boeing introduced the 747, which many consider to be one of mankind's greatest engineering achievements.

Although I know next to nothing about Phil Condit either, my guess is that he was and is no idiot. I do know he rose through the ranks and was not an outsider when Boeing began what appears to me to be a deliberate and justifiable attempt to match the quality of their engineering staff to the fact that the US had already been in the maintenance phase of a declining civilization for many years. The more recent problems Boeing has experienced are likely the result of later management teams taking the path that Condit and others started going down to a silly extreme long after Condit left the company (somewhere around 2005).

[aeden]

Rule number one in Corporate mid tier is never Hire one smarter than you.
Watched this for well over 4 decades. Finally the incompotence got to bad they fired
the person that hired Him and cleaned house top down also after bankruptcy not adapted as a Kuznet decade legal structure.
This case earlier was when the japs and germans clear cut anything and everything for MEOH
and we bankrupted the Germans soft power metrics. As indicated these fools today swim in a bathtub
curve they do not even fathom. One zone we had to pull out of they shot you in the head if you questioned
mass transport and the other had to have armed military escort to supply techical support for water treatment
as the red brigade moaist got corraled. The have no clue how deep the rot was then and the actual way contracts
adapted to negate the carnage. These issues have been around since the 1948 constructs you may recon as NGO
that are and have been infitrated as they cannot even factor in the silent weapons of the silent war and the
evolution of contract to effective sane balances. The first step was effective direction in the Pareto effect
as CFR measure implemented in negation process of dead workers after a decade of ignoring sane statutes to
worker heath and safety program to infer sanity and the dead peasant industry payments reductions.
About a half decade later the usual suspects that survived the transfer or else since you blew up a place or
took out a water supply of yes much worse in blatant acts covered by once again the usual suspects as
affimitive action masked as DEI usual suspects programs we see once again. The best advise is start
your own S Corp if you can value add a contract in. They will not care to think, or will as once change from the outside
if faster than in indide its already been over Cookie cutter.
Boeing moved from the left coast to the right coast for reasons as they had no choice being taken out in many facets.
Like you said the genuises could not even change there own oil inside or out. Cycles are real and really rather not understood.
Th HR got so smug and bad they even recently farmed that out also as I retired since the facts remain. They hired what they deserved.
Blindspots as legal loots them stupid also.
Europe is at least if not now as fucked up as the US.

Biden Administration bureaucrats are depressed because they can’t find new jobs.
Learn to code. We had to.

No matter what side you choose, you lose half your customers.
Henry Ford.

[Higgenbotham]

But what will rock the boat is America's national debt, Ray Dalio has warned, and it's a crisis coming down the pipe "imminently."

Speaking at CONVERGE LIVE in Singapore, the Bridgewater founder explained: "We have a very severe supply and demand problem. Some people think we'll handle it because we've handled it so far. I don't think they understand the mechanics of debt."

Dalio continued that, at some point, the U.S. will have to "sell a quantity of debt that the world is not going to want to buy.” This is an "imminent" scenario of "paramount importance," Dalio said.

The man worth $16.2 billion isn't the only economic expert to have this opinion. Wharton Business School finance professor Joao Gomes previously told Fortune: “The most important thing about debt for people to keep in mind is you need somebody to buy it. We used to be able to count on China, Japanese investors, the Fed to [buy the debt]. All those players are slowly going away and are actually now selling.

"If at some moment these folks that have so far been happy to buy government debt from major economies decide, ‘You know what, I’m not too sure if this is a good investment anymore. I’m going to ask for a higher interest rate to be persuaded to hold this,’ then we could have a real accident on our hands."

https://www.msn.com/en-us/money/markets ... 1931&ei=12

[Higgenbotham]

Rule number one in Corporate mid tier is never Hire one smarter than you.
Watched this for well over 4 decades. Finally the incompotence got to bad they fired
the person that hired Him and cleaned house top down also after bankruptcy not adapted as a Kuznet decade legal structure.
This case earlier was when the japs and germans clear cut anything and everything for MEOH
and we bankrupted the Germans soft power metrics. As indicated these fools today swim in a bathtub
curve they do not even fathom. One zone we had to pull out of they shot you in the head if you questioned
mass transport and the other had to have armed military escort to supply techical support for water treatment
as the red brigade moaist got corraled. The have no clue how deep the rot was then and the actual way contracts
adapted to negate the carnage. These issues have been around since the 1948 constructs you may recon as NGO
that are and have been infitrated as they cannot even factor in the silent weapons of the silent war and the
evolution of contract to effective sane balances. The first step was effective direction in the Pareto effect
as CFR measure implemented in negation process of dead workers after a decade if ignoring statutes to
worker heath and safety program to infer sanity and the dead peasant industry payments reductions.
About a half decade later the usual suspects that survived the transfer or else since you blew up a place or
took out a water supply of yes much worse in blatant acts covered by once again the usual suspects as
affimitive action masked as DEI usual suspects programs we see once again. The best advide is start
your own S Corp if you can value add a contract in. They will not care to think, or will as once change from the outside
if faster than in indide its already been over Cookie cutter.
Boing moved from the left coast to the right coast for reasons as they had no choice being taken out in many facets.
Like you said the genuises could not even change there own oil inside or out. Cycles are real and really rather not understood.
Th HR got so smug and bad they even recently farmed that out also as I retired since the facts remain. They hired what they deserved.
Blindspots as legal loots them stupid also.
Europe is at least if not now as fucked up as the US.

Biden Administration bureaucrats are depressed because they can’t find new jobs.
Learn to code. We had to.

No matter what side you choose, you lose half your customers.
Henry Ford.

Does the best person get the job? No.

And it's gotten much worse since this article was written in 1987. I think nowadays the standard is for 9s to hire only 5s or less.

The Art Of Hiring '10s' Why your new recruits may not be as sharp at the people you used to hire

BY I. MARTIN JACKNIS

Have you noticed that the high level of enthusiasm and talent that characterized your organization when you started out is no longer the norm? If your answer is yes, you may find it puzzling. After all, you recruited first-rate talent, and you assume that your people continue to hire only the best.

Chances are your company has fallen victim to what I call the "law of diminishing expertise." It's an organizational weakness that's particularly virulent in fast-growing companies. And as I found from my own experience, it can be deadly if left unchecked.

Here's how it works. A hard-driving, creative person decides to start a company. By any standard, he'd be considered a natural "10." He's resourceful and enthusiastic, a dynamic self-starter who's determined to make his own venture a winner. He's such a strong 10, in fact, that he generates too much business to handle alone, and he has to bring in others to help him out.

That's a critical juncture in the growth of this imaginary new company. Will this 10 hire other 10s to work for him? Or will he hire 9s or even lower? It's obvious, you might say, that if he wants to maintain the momentum of his success, he shouldn't settle for anyone who doesn't meet or exceed the standards he personifies. Yet I maintain that, in most cases, a company founder like this wouldn't hire another 10 to work for him -- even if another 10 were willing to do it.

Like most 10s, he probably worked very hard to get where he is today. He has talent, drive, a well-developed ego, and likes to exercise a lot of control over his work environment. In fact, that's one of the main reasons he wanted to start his own business. So it's not likely he's going to bring in people who'll challenge his opinions or his authority, and other 10s might do just that. Besides, even if he wanted to hire others who could match him in every respect, most other 10s in the marketplace have their own egos and ambitions. They might consider working with another 10, but they certainly wouldn't want to work for one.

At the very best, then, this 10 will hire a few 9s, maybe with the potential to become 10s. So at this stage of its development, the growth chart of this company might look something like figure 1.

Well, there's nothing wrong with an organization that looks like that. A small business consisting of an exceptionally talented 10 and a crew of 9s can be a powerful team. So before you know it, the company will probably enter another growth curve, and still more talent will have to be brought on board.

At this point in the growth of his business, it's only reasonable that our founder is going to want the team members he's chosen to do their own hiring. After all, they're the ones who'll have to supervise the new recruits and work closely with them on a day-to-day basis. But here again, we have to ask the question we asked before. Will a 9 hire another 9? And, again, I contend that the answer generally is no. At best, a 9 will hire an 8 with potential, and the growth chart of the company now looks something like figure 2.

What's begun to happen in this organization is something that happens to many rapidly growing companies. Buoyed by the fresh ideas and enthusiasm of their founders, they seem to do well in their early stages. But then they reach a certain level of growth -- in my experience, usually around the $10-million mark -- at which they begin to lose their cohesiveness and sometimes even self-destruct. Let me tell you how I first discovered the law of diminishing expertise.

Several years ago, I helped start Creative Output Inc. We grew from 2 employees to around 130 in a little more than three years, and in 1984 we reached #6 in the INC. 500 rankings. In the beginning, I handled all the marketing, sales, public relations, and advertising for the firm. But as the business flourished, I added new staff members in a fashion similar to what I described above.

Then one day I decided to go on a sales call with a 9 I had hired and one of his 8s. I sat back, relaxed, and watched attentively while the 8 gave his presentation to a prospective client. Afterward, when I asked him how well he thought he had done, he proudly told me that, on a scale of 1 to 10, he firmly believed his performance was a solid 9. Then I asked my 9 how well he thought his 8 did, and he told me the presentation was really no more than a 7.

When I got back to my office, I felt like crying. The salesman's presentation, in fact, was barely a 5 compared with what we had been doing in the past. And I realized that if this pattern continued, our company wouldn't be able to survive for very long, much less prosper. What really bothered me was that our 8 had characterized his performance as a 9. What if we were to allow him to hire what he considered a 7? Then that person's perception of an outstanding job would be the equivalent of what I would judge to be a 2!

I suspect that the law of diminishing expertise is universal.

https://www.inc.com/magazine/19871001/1614.html

The "Crusty Old Bureaucracy" Theory

Let's take a look at one more explanation of why the 2000s decade will be a decade of depression. This is meant to be an intuitive explanation, not a rigorous argument.

As we mentioned above, the 1930s agencies and regulations designed to prevent another depression didn't work because they didn't change human nature. Now we're going to explain why human nature is such that we must always have a financial crisis like the Great Depression every 80 years or so, and that there's nothing we do to prevent it.

I got the idea for this when I heard a television business news story that described some company as having financial troubles because the "crusty old bureaucracy" that was running the company was moving too slowly keep the company competitive with newer upstarts.

The problem with any organization that lasts a long time is that it gets set in its ways; it gets departments and divisions that are slow to change; employees lose their energy and don't want to rock the boat.

Ordinarily, such an organization will go out of business because it's not competitive enough, and its business will be taken over by more up to date and aggressive competitors.

The problem is that a society (or country) can be thought of in exactly the same way. Looking at a country as a whole -- its entire government, all its businesses, labor unions, educational institutions, and non-profit institutions taken together -- a certain, ever-increasing percentage of these organizations viewed as a whole are going to become inefficient. The crusty old bureaucracy will grow with time.

It's the word "ever-increasing" in the preceding paragraph that is the crux of this argument. Some readers may not agree that the amount of inefficiency constantly increases with time; that businesses, government agencies, educational institutions, and so forth, constantly renew and improve themselves, so that they're always just as efficient as ever. If you believe that a society as a whole stays just as efficient as ever over time, then you won't agree that we have to have a Great Depression every now and then.

But if you believe, as I do, that the buildup of bureaucracies, politicians and layers of control, and the tendency of people and organizations to do their job without rocking the boat with changes means that society as a whole becomes inefficient as time goes on, then the conclusion that Great Depressions are always necessary is inevitable.

In my many years of experience as a computer industry consultant, I've seen what happens with my own eyes. There are many businesses that have computerized, eliminating layers of management, streamlining accounting, manufacturing, order processing and other departments, eliminating large groups of employees doing work that can just as easily be done by a computer that doesn't require a salary.

But I've also seen many, many other businesses that haven't done that: doctors' offices with racks of patient records in paper folders; business offices which use computers for no more than word processing and an occasional budget; rooms full of pencil-pushing employees that perform repetitive tasks all day long - tasks that could better be done by computers. These are the businesses that will be wiped out by a new Great Depression.

Elsewhere in this book, I discussed the concept that "war is senseless" to many people. It's true that war is senseless to the individual, but from the point of view of survival of the human species, war -- including genocide and mass rape -- is extremely sensible, because it guarantees that the strongest races, civilizations and nations will survive, and the weaker ones will die off.

A Great Depression is, like war, another of "nature's ways" of renewing a society. When poverty is rampant and the unemployment rate is above 25%, as it was in the 1930s, then not rocking the boat is impossible. Thousands of businesses will shut down, eventually to be replaced by new businesses that are more efficient. Governments at all levels will be forced to shut down and cut back on all its agencies, because the level of tax collections will be way down. Similar observations will be true for educational institutions, labor unions, non-profit institutions, and so forth.

Organizations in all sectors will disappear, as they did in the 1930s. The ones that survive are able to do so only by completely reinventing themselves, and accepting inevitable cutbacks in all but the most essential jobs, and letting employees in non-essential jobs go to fend for themselves. That's how society renews itself.

When I talk about things like this, people criticize me for being too negative. Heck, even I get depressed reading the paragraphs that I've just written. But being warm and fuzzy is for another book on another day, or by a different author. This book was not written to make people feel good; it was written to describe what I, as a mathematician and researcher, consider is likely to happen.

What does a "depression" mean for our lives?

Since the word "depression" means different things to different people, it's worthwhile to point out that in this book it refers to one specific thing: A big drop in stock market value, similar to the big stock market fall in the 1930s.

But what does that mean in terms of people's lives? In the 1930s, it meant massive unemployment, bankruptcies and homelessness. Are we facing the same fate today?

The forecasting tools that I've used to forecast the massive drop in stock prices do not tell us what ups and downs stocks will take before reaching bottom, and do not answer the questions about bankruptcies and homelessness, so we can only guess.

In the 1930s, money was very tight. People and businesses that owed money were forced to pay their debts or go bankrupt. Businesses that went bankrupt laid off employees, causing more unemployment and more personal bankruptcies. People who went bankrupt often lost their homes, becoming homeless.

Today, the Fed is acting to prevent these massive results by flooding the economy with money -- by keeping the federal funds interest rate close to 0%, and possibly by repurchasing long-term bonds. Businesses that are close to bankruptcy can often borrow cheap money and keep going. People who are close to bankruptcy can often borrow against credit cards, which pass along the low interest rates to their customers.

So we're seeing a different effect on people's lives of the massive stock price drop than we saw in the 1930s. In the 1930s, people went bankrupt and homeless. Today, people and businesses are going massively into low interest rate debt.

It's not known what effect this will have in the long run. In the optimistic scenario, it will give businesses time to change to produce 21st century products, instead of the old 20th century products. In the pessimistic scenario, it will keep the "crusty old bureaucracy" in place a few years longer, thus causing an even harder fall when the fall finally comes.

http://www.generationaldynamics.com/pg/ ... ession.htm

Crusty old bureaucracy theory

How is it possible for prices to fall, even during a financial crisis?

The explanation is what I call the "crusty old bureaucracy" theory.

There is a long-term generational cycle in business, where there is a "great depression" every 70-80 years or so. In American history, a British banking failure in 1772 sent most New England businesses into bankruptcy, providing a monetary motivation for the Revolutionary War. The Panic of 1857 bankrupted many American and European businesses, leading to the Civil War. And of course the Great Depression of the 1930s was one of the causes that led to World War II.

From the point of view of Generational Dynamics, here's what's going on: During the 1930s Great Depression, most old businesses went bankrupt, and every new business was "lean and mean," with every employee required to pull his full weight.

In the intervening 70 years, these businesses have all been getting calcified with bureaucracies, older employees who are waiting around for retirement, middle aged employees whose job skills are obsolete, or whole departments or divisions producing products and services that people no longer want. Therefore, the average American business today is producing too many overpriced products that nobody really wants. The same calcification process has also happened with government agencies, universities, and all other organizations. This is what I call the "crusty old bureaucracy" problem.

So the economy will "correct itself," but will do so by a major adjustment like the crash of 1929. This will force all the existing businesses into bankruptcy, and the cycle will repeat with the creation of new "lean and mean" businesses. Unfortunately, the side effects of massive homelessness and even starvation will also occur.

Another side effect is that products have been getting gradually obsolete, and this has been happening on a national basis. In the extreme, once enough businesses are producing obsolete products, inflation can't increase because no one will want the products at any price. The only way to fix the problem is through massive business bankruptcies and a new set of businesses.

In the current economy, one of the most visible examples is music CDs (compact disks). There's a huge chunk of business associated with manufacturing, distributing and selling CDs. However, CDs are becoming increasingly obsolete, because people want their music on their computer, and don't want CDs around cluttering up their homes. In other words, people don't want CDs at any price. CDs is one example, but you can easily think of many more examples in other domains where computerization are making products obsolete, or at least way overpriced. After the financial crisis, it will turn out that there are many products like that, and so prices will remain low and inflation will remain low.

Life in the next few years

We're at a unique time in history, about 60 years after the end of World War II, when every country is experiencing the same generational change at the same time: The people in the generation that fought in WW II are all disappearing (retiring or dying) all at once, and are being replaced by the people in the generation born after WW II. This new generation has no personal knowledge of the horrors of World War II, and will lead the world into a new world war. As I've described in the discussion of the six most dangerous regions of the world, the time is not too far off when a regional war in one of these regions will trigger a much wider war that will engulf America and the world.

You can see this happening today especially in the Northern Pacific, where the level of conflict is increasing on an almost daily basis, and both China and North Korea are evidently planning preemptive wars of reunification (with Taiwan and South Korea, respectively). These wars might begin next week, next month, next year, or thereafter.

What will life be like for the next few years? It turns out that we have a pretty good idea. Historians William Strauss and Neil Howe have studied what's happened in previous American crisis periods, and have published their findings in two books, Generations and The Fourth Turning. In fact, their generational theory forms the basis of Generational Dynamics.

Based on what happened during the previous crisis periods -- World War II, the Civil War, and the Revolutionary War, they tell us (in The Fourth Turning, p. 258) what's going to happen:

Private life will transform beyond prior recognition. Now less important than the team, individuals are expected to comply with new ... standards of virtue. Family order strengthens, and personal violence and substance abuse decline. Those who persist in free-wheeling self-oriented behavior now face implacable public stigma, even punishment. Winner-take-all arrangements give way to enforceable new mechanisms of social sharing. Questions about who does what are settled on grounds of survival, not fairness. This leads to a renewed social division of labor by age and sex. In the realm of public activity, elders are expected to step aside for the young, women for men. When danger looms, children are expected to be protected before parents, mothers before fathers. All social arrangements are evaluated anew; pre-Crisis promises and expectations count for little. Where the Unraveling had been an era of fast-paced personal lives against a background of public gridlock, in the Crisis the pace of daily life will seem to slow down just as political and social change accelerates.

When society approaches the climax of a crisis, it reaches a point of maximum civic power. Where the new values regime had once justified individual fury, it now justifies public fury. Wars become more likely and are fought with efficacy and finality. The risk of revolution is high -- as is the risk of civil war, since the community that commands the greatest loyalty does not necessarily coincide with political (or geographic) boundaries. Leaders become more inclined to define enemies in moral terms, to enforce virtue militarly, to refuse all compromise, to commit large forces in that effort, to impose heavy sacrifices on the battlefield and home front, to build the most destructive weapons contemporary minds can imagine, and to deploy those weapons if needed to obtain an enduring victory.

One of the political consequences is that programs like Social Security, Medicare and Medicaid will be discontinued or substantially cut back. In a time when the survival of the nation is at stake, the needs of the elderly will have to give way to the needs of the young. By 2010, it will be very difficult for a non-wealthy older person to survive comfortably.

This is the kind of world we're headed for. It won't be the end of the world, but it will be worse than the horrors of the Great Depression and World War II. America has gone through this kind of thing three times before, and will do so again.

As I've done before, I'm cautioning all my readers to be taking steps to protect yourself, your family and your nation. The world today is much worse than it was a year ago, and things are getting worse every day. The public debt situation and the level of world conflict grow, and more and more commentators are noticing it. We must come together as a nation to protect one another, because we are going to have no choice.

http://www.generationaldynamics.com/pg/ ... 050324.htm