The U.S.
stock market didn't hit the peak it achieved in 1929 again until 1954 (9,080
days from September 3, 1929 to November 23, 1954). The recovery didn't really
begin until the build up for the Second World War began in 1939. But what's
most instructive about this is less which government policies worked or did
not, but that the economy we had at the far end was utterly transformed.
Think of it: by 1952 the United States had become a
superpower, the world had been divided into east and west, and the economy had
seen the advent of the nuclear age, the beginning of the computer era, the
emergence of the multinational corporation, the first stirrings of the service
economy. The United States
of 1952 did not look very much like 1929 Washington.
Now, we're not expecting a 23-year recovery cycle here, but we should consider
how the U.S.
economy and the world are likely to be different in say five to seven years
which is probably the earliest we might expect returning to all the pre-crisis
levels.
It's going to be very different and we ought to be leading
the receiver (to use a football term) on this one, spending for what we will
become rather than struggling to preserve what we will never be again.
OFF/AFP/Getty Images
Read More
(1)
HIDE COMMENTS LOGIN OR REGISTER REPORT ABUSE