We will not have another depression, but our economy will change as it never has before

[TwixVoy]

I believe that we will not experience another depression. I believe we will have a plentiful supply of food, and we will not see anything like the food lines of the past.

I think what a great number of people have not yet realized is that the time of wealth our country has experienced is quickly coming to an end. I think the end result of this crisis will be the United States becoming a poor nation. We have sent most of our wealth to foreign nations such as China who have now built up a huge manufacturing base at the same time we are about to lose the last remnant of ours. Manufacturing/producing is the key to building wealth. As it stands 80% of our economy is based on consumption.... and to make it worse consumption based on debt. We are a nation of debtors who collectively have a negative savings rate. One of the very images of being poor.

I believe that retirement will be a thing of the past to most people. I believe that overall it will be possible to "live", but few will have much of excess. The days of spending $5 on a cup of coffee will be over. Huge tank vehicles that get 5 miles to the gallon? You better believe that's over.

I believe most jobs in the nation will be paying enough to allow survival, but not much else. The last stronghold of unions in this nation is about to be intentionally killed off.

I think we are looking at the US Dollar no longer being the reserve currency. Keep in mind that when that happened to the British pound it lost 90% of it's value. Why does that matter you ask? Well, if the dollar starts to lose massive value China and others will be much less likely to want to keep sending over products for us to "consume" when our money isn't worth it any longer.

Can we turn this around? Possibly, but it will take well over a decade IMO and likely longer.

On the bright side.... at least in a few years India may start outsourcing to US. (and that is only a half joke...)

Generally I see life being harder for almost everyone except the upper 1%. This is something that will be long lasting. Anyone that thinks we will see a 2009 "recovery" and it will be business as usualy after that are setting themselves up for a major disapointment.

[HEyHEY]

1. That's why I'm fleeing to China to wait this out.

[truedelphi]

2. You have no chance - at least not until the ice floes return!! n/t

[HEyHEY]

3. nuh uh! I leave in four weeks!

Actually, it will be interesting to see how this all hits China

[charlie]

5. Factory riots in the south

Orders are way down, since they're still largely yoked to us. They need 8% growth a year just to employ new workers that enter the market, and they're hovering around 6% right now.

[hunter]

9. Congratulations! Hope the times are not too *interesting*

If the U.S. is not buying, China needs to figure out how to distribute what they used to export within China.

Otherwise there will be unrest.

[truedelphi]

19. Where in China are you going?? Are you gonna live there

Or are you gonna travel around??

In any event, I wish you safety and much joy on your trip.

[HEyHEY]

20. Beinjing, for work

Shoudl be interesting

[Liberal_in_LA]

4. unfortunately, I agree with you

[anigbrowl]

6. Japan was stagnant for a decade

It was no picnic, but it wassn't the end of the world either. Mind you they have a better social system over there. Debately a better culture too. Too bad reading Japanese is such a PITA.

[TwixVoy]

7. You also have to keep in mind

during the lost decade in Japan the vast majority of the country had a positive net worth. (read: money in the bank, savings) We, on the other hand, have a collective negative net worth and most people have NO real money in the bank. Very different situation, very different position, and our position is by far worse.

[girl gone mad]

8. They still had a manufacturing base..

and they kept their currency artificially low (which was the root of the carry-trade which eventually caused Iceland's economy to boom and implode).

We don't have much manufacturing. We can play beggar thy neighbor, but we'll probably lose.

[DonCoquixote]

10. The thing to remember is

For all of China's achievements (and they are indeed EPIC, their greatest work since the Great Wall) they are based on one thing, Americans having money to but their stuff. Europe will not buy their stuff, and the Latin Americans nations will want their own manufacturing base with tariffs. So, if we go down, so does China. Hoenstly, there are very few places in the world that could escape the economic meltdown, period.

[qwlauren35]

11. I think that's the ultimate irony.

The first world and the third world will move a few inches toward equilibrium, and the citizens of first world countries are going to freak out, even though their lives will be nothing like those of some of the people in Dafur or Somalia.... or war torn Iraq.

We have Americans today who cannot imagine living without cellphones, cable or (I'm one of them) the Internet, even though each thing I've named has a service fee. Many of us can't imagine living without our cars, some of us would die rather than share our homes... even with other family members.

I think that's when our nation's immigrants will truly come into their own. No matter how much we native-born multi-generation Americans won't like it, America's immigrants, and children of immigrants will be able to survive this "recession" a heckuva lot better than the rest of us.

[TwixVoy]

12. They are in a position now

to wash their hands of us.

I watch TV economic news broadcasts made in Asia on a pretty frequent basis. The constant and consistent message the talking heads over there keep saying is "Get rid of your US dollars/investments ASAP". Do some web searches for live streams of english news broadcasts in Asia. I think you'd be very surprised to find out how open they are in the Asian media right now about getting as far away from us as possible.

They are washing their hands of us right now. It won't be all overnight, but it is gradually happening.

China has a growing middle class. They have their own internal economy, and established trade relationships all over the world.

While it is true they DID need us to get to the point they are at now, they do NOT need us anymore. It was almost a parent/child relationship. Parent helps child get stronger, and once they get strong enough they leave the nest and do fine on their own.

I think a LOT of Americans are going to be surprised to find out just how little China needs us leeching off of them with borrowed dollars these days....

[DonCoquixote]

18. Er, yes and no

The fact is, The Chinese know that most places will not but their stuff as much as America does. Europe showed them it does not respect them, as their press during the Olympics was frankly some of the most racist crap since the days of the "Yellow Kid" comics. They cheered when the torchbearer (a lady in a wheelchair )got assaulted in Paris. They also kept talking about how "Chinese culture could never be great because they cannot export their culture." Granted, these people are the same people whose fathers probably ate tea and noodles in Saigon (back when the French ruled it), but of course, that does nto matter. As far the rest of Europe, well, all of them carved China up into "spheres of influence." This is not to say they will not try to put us in line, but in order to make the big corporate profit powerful people are used to, you need to sell your stuff worldwide, and very few of the powers that be will ever allow their base to be compromised as badly as the us is.

[sandnsea]

13. You're describing a Depression n/t

[TwixVoy]

14. No I'm not

I'm describing a more rough and poor life than what most are used to. A depression would look much worse than what I described. Or did I write we would have 50% unemployment, people would be starving in the streets, and even basic living costs couldn't be met?

[sandnsea]

15. That has never happened here

During the Depression, unemployment was at 25% at its worst. People live every day when their basic living costs can't be met. We were in a recession a year ago and it is way worse now than it was then.

I was at the dollar store today and there were 4 people shopping. Four. Yesterday I was in the toy department of another store and nobody was there. I walked right out the check-out, nobody was in line.

And this is in a retirement town where most of the people have a stable income.

[Waiting For Everyman]

16. Most of America has been "poor" for a long time now.

Those who weren't, didn't notice, that's all. This is not new. It's merely spreading upward to the remaining minority.

[aquart]

17. About that food you're counting on....

You know that this nation still hasn't made viable plans for climate change? Climate change means changes in crops, growing seasons, susceptibility to disease... Our wheat belt is moving to Canada. Our maple trees, too. Our vineyards are desperately trying to stay in place.

And the wheat crop had some problems this year.

Then, of course, there's that little problem with the bees.

We are used to endless plenty. Don't be too sure it will continue.