Celebrating the Great Depression

Celebrating the Great Depression

Most people understand the world would keep spinning after they’re gone. Ask an economist, though, and they’d probably tell you otherwise.

In truth, the number-crunchers have a point.

For a decade now, the global economy has nervously kept vigil of the guillotine suspended above its head. Decapitation has loomed large, with not a happy ending in sight.

Growing up, you’re told all stories have happy endings.

The journey is often perilous and fraught with danger, but our protagonists always find a happy resting ground.

Somewhere along the way, this changed.

Where once booklovers would flip each page waiting to discover its secrets, they now start their journey at the end. Happy endings have given way to sombre, grittier denouements. And not everyone is thrilled by this.

For them, the destination has become more important than the journey. After all, what good is the journey if it can’t offer a lasting sense of hope and peace? And increasingly, very little in this world does.

But this desire to know how a story ends is borne from insecurity, not intrigue. It’s about closing your eyes and ears to the possibility of hurt. There’s enough hardship in everyday life that when people seek escapism, they want the kind that makes them feel good.

This same mindset has infiltrated all walks of life, to varying degrees.

Fear of what the future might bring paralyses people.

Instead of happy endings, they hear of unimaginable levels of debt they believe will return to consume them. If that doesn’t kill them, the always-on-the-horizon Third World War surely will.

No, things aren’t as we’d like them to be. Like you, we can’t shake that nagging feeling that something isn’t right.

But, dear reader, we’re here to tell you that you need not worry.

We’ve seen how the world ends.

[Spoiler alert: This story has a happy ending.]

The joyous depression

There was a time in history when the world ended.

The early-to-mid 20th century was a spell of unimaginable misery and suffering.

Of course, it’s easy for us to look back at history and assume entire generations of people knew nothing but despair. But we only do so because our accounts focus on the horror stories, leaving out the mundane bits in between.

In fact, there’s no quicker way to scare someone today than to bring up the prospect of a Great Depression in our lifetime.

It elicits all sorts of horrible thoughts about a future in which people scrounge through bins in back alleys and partake in casual cannibalism.

But we both know that’s not true, don’t we?

Of course there was lots of hardship and pain, but accounts of that era tell a different, less extreme, and perhaps even uplifting story.

In the United States, where the depression was felt most, one in four people were left without work. But even this apex of economic hardship in history still kept three quarters of people in a job.

Yes, some people did starve. Others lost their homes.

But the majority survived a decade of adversity to come out the other side of it with more strength, better ideals, and a healthier outlook on life.

So the Great Depression did change people, but not necessarily for the worst.

For one, there was a broad shift in how people came to view money. They became more frugal and self-sufficient, squeezing every last cent.

Credit wasn’t an option. There was no instant gratification. You’d earned what you bought. And you only bought that which you needed.

While money was scarce, it was scarce for everyone. Many debts couldn’t be repaid, and they weren’t expected to be.

All in all, society became more financially independent.

This sense of shared hardship brought people together.

People helped each other out.

This instilled discipline across all generations, and had a particularly strong effect on the young.

To make ends meet, entire families took up odd jobs to supplement household income. In the long run, this instilled a sense of appreciation for hard work and the value of money.

Without question, the Great Depression put an abrupt end to rising mass consumerism.

Expensive dining and entertainment became a step too far for many. But people adjusted by taking up hobbies that were cheap and free. They spent more time playing ball games with their children, reading, and enjoying quality family time.

Did you know that divorce rates fell during the Great Depression? Filing for separation became expensive. Struggling couples stuck it out not only for their kids, but for their own wellbeing and finances. We’ll never know how many marriages and families were saved by the Great Depression.

With purses tightening, people stopped driving altogether. Instead, they took up bike riding, which was not only free but beneficial to their health.

Even people forced to vacate their homes turned the depression into an opportunity. City slickers piled into rural towns, with many going into farming. Food there was not only more secure, but organic too.

Perhaps most importantly, communities became more tightknit. Neighbours relied on one another for help, and they became better friends for it.

They not only shared supplies and living quarters, but offered critical emotional support. This was a time when neighbourhoods were neighbourhoods, not disparate clans occupying a shared space.

Yes, the guillotine may have fallen on this generation. But the protagonists in this tale didn’t just survive the Great Depression. They emerged from it stronger, less indebted, and more united.

As our fractured and overstretched society lurches into its own crisis, we’d be wise to learn from the experiences of our forebears.

The guillotine idly hanging above our heads doesn’t have to represent the end. It may just free us from our current bondage to an ever oppressive financial elite.

Until next week.


Jim Rickards Signature

Mat Spasic,
For The Daily Reckoning Australia