The Second Great Depression

“Our Generation has had no Great war, no Great Depression. Our war is spiritual. Our depression is our lives.” — Chuck Palahniuk

. . . . . . . The stock market is heating up again to superhot levels we’ve not seen in a while as institutional and private money comes pouring into the scene. It was hot once before …. in 1929. What would happen if there were a second Great Depression?

. . . . . . . The government response would be much faster and more powerful than the first time around. Then, it took years of waiting and the inadvertent creation of Hoover Camps before a new President could be ushered in. Then, they fumbled around from 1933 to construct an edifice that would come to be known as the New Deal. A modern-day New Deal would be much more expensive but this time America has 3x the population to deal with the crisis, and technologies that were undreamt of in days of yore.

. . . . . . . I suspect the historians would be summoned in to explain to postmodern policy-makers exactly what Roosevelt and his team did, from A to Z. Some 1930s programs would be rehashed immediately and brought back to life; others would be discarded as unworkable for modern times. But it would certainly resemble the New Deal in spirit and intent. New Deal 2.0 would be far-reaching, without a doubt. It would leave no stone unturned in its pursuit of economic justice.

. . . . . . . Even though justice sometimes gets pursued, rebellion may not be far off. It just takes a tiny spark to set a conflagration on fire.

. . . . . . . If it is a Republican administration in power at the time of a Second Great Depression, expect to find them acting suspiciously like Democrats in their measures and actions. The Republicans have already demonstrated this in their actions in the 2008 Great Recession, when they intervened to stop the stock market from imploding totally. This partly successful action confirmed Keynesian logic in spirit and gave the lie to the right as the party of small government. We have lived in a thoroughly mixed economy since the 1930s, and even before then when the Fed was a’birthing, and income tax was being proposed, in the dawn of modern times, the mixed economy was halfway born and struggling to be alive. It is easier to escape death today than it is to escape living in a mixed economy anywhere in the world. The hand of government, subsidizing and fertilizing the private-sector plains, has awakened a need for security in the public and in major financial institutions worldwide. This shall not abate.

. . . . . . . In a Second Great Depression, expect to see the computers working flawlessly as long-dead programmers execute their art from beyond the grave. The Great Priesthood Class — the industrial engineers and the computer programmers who stand beside them — will provide much-needed technical support in the Second Great Depression, making sure that the technicos stay employed, at least. As is usual, skilled labor will benefit from a collapse of prices and markets, snapping up properties on the cheap and getting that second summer home they’ve always wanted for a steal. It will be a buyer’s market, during the SGD.

. . . . . . . The SGD will be counted as the most severe economic dislocation in history. Whenever more is on the line, that means there’s more to lose — and today’s world is the richest it’s ever been. The ascent to dizzying heights has been accompanied by an ascent in risk-taking, as the algorithms on the stock market take control.

. . . . . . . In fact, it will probably be flawed programming in some gigantic firm’s home computers that triggers an SGD. Some mechanism for shaving milliseconds off a transaction will start to look at historical trends in a skewed, schizophrenic way and the machine will go crazy. Don’t think it can’t happen. Black Monday — on Monday, October 19, 1987 — was the largest single decline in stock market history, and it was precipitated by the machines. Skynet had a hiccup. Or maybe Skynet caught a cold and the whole world fell ill.

. . . . . . . The machines that make SGD a go are still being constructed today. When quantum computing becomes a forcible reality affecting the markets it will signal a sea change in the way we run our machines …

. . . . . . . … or our machines run us.

. . . . . . . Glass of champagne toast, anyone, to the new technological frontiers???


5 thoughts on “The Second Great Depression

  1. There is no doubt that our machines run us; with the race to automate everything in this world (perhaps emotions and how we react some day) only makes it all the more scary. Will we even need human intervention to regulate, to think, to innovate or will machines some day have the intelligence to create and be creative without a doubt ? Not that I am against automation but I wish for a certain balance. Now I am not sure if a Second Great Depression is inevitable but over the years we have seen the richer getting only richer, much more during Covid times, and the poor getting poorer and shrinking more and more into the pathos of despondency. There is no doubt that the world is run by a few elite and rich conglomerates. Here we are talking about travelling to space and having colonies at Mars (Lord save that red planet) and back in our backyards the poor are dying, sans medical care, sans homes to rest, sans food to survive. Isn’t this in a way a Great Depression by itself ?

    1. You make some good points. I think machines are more tricky than the science-fiction writers supposed. I worked in computer science eons ago myself, and I know how hard it is to make good code. Even randomizing effects aren’t really random. To make an Artificial Intelligence might require more effort than we can imagine.

        1. The urgency may be there, but will the success be? I repeat: AI could be an impossibly hard puzzle to crack. We shouldn’t let science fiction influence our realistic projections of the future.

          1. True but have you read the news about robotic installations in Paris to make pizzas. The concern isn’t about robots taking over but taking over jobs in an already unemployed world.

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