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cropsey, il 61731 | In 2008 there were remnants of an economy still lingering around which are not really here. When so few are adding any real value to anything, there is not much to base an economy on. There are a few essential services, but most are non-essential and can go away just about overnight. It's not like we have world leading industry that may take a few lumps here and there, but pretty much keep marching since they make things people want and need. Therefore, when things go south, they go straight south.
Also with so much of the economy on some type of welfare, the 401K/IRA contributions have to be slowing way down (especially with under employment). At some point don't the wallstreet folks starting getting low on cash to throw at the market? Maybe there isn't a bunch of money waiting around to invest in gold? Our meager bank accounts are not going to push the price anywhere.
Consider that the volatility and price runs ups are created by massive amounts of money flying around. If the "massive amount" is now not so massive, the balloon deflates and down it goes.
Most of this is no problem what so ever since it's the market's function to weed out poor productivity and shams. The problem is we kept dinking around with the system trusting folks that always intended on robbing whoever they could so that their tenure in the market lasted long enough to potentially hurt a lot of folks. Typically these guys would go down taking a relatively small number of 'believers' with them. John Corzine wouldn't exist if he had to actually be accountable.
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Memories of 2008 are dancing in my head this morning.
