MacroScope

Small credit for big depression

April 15, 2009

It took some time, and a lot of downward corrections to IMF GDP forecasts, before the current global economic downturn won the title of ‘worst since the Great Depression’.

Why settle for second worst though?

This one is in at least three ways just as bad if not even worse than 1929-30, economists Barry Eichengreen (University of California, Berkeley) and Kevin O’Rourke (Trinity College,
Dublin) argue

Look at global industrial output, world stock markets, and global trade volumes. Map the nine months after April 2008 against the period following June 1929 and the story you see is the following:

* the decline in industrial production is at least as severe  * stock markets sank faster this time * trade volumes are falling much faster now

Eichengreen and O’Rourke say the reason people tend to say that this one is second to the Great Depression is because the comparisons tend to be between the United States now and back then — not the world now and back then.

Which begs the question — if this one is every bit as bad as the Great Depression, it’s the worst since when?

Comments
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If we think things are bad now it is still nothing to compare to the 1920s and 30s. Things were bad, real bad, during the great depression. There was an individual that fought for the cause of the Laboring man in Louisiana and the country. His name was Harvey G. Fields and he fought the Bankhead act and called for the replacement of Hugh Johnson as the head of the NRA. Both of these actions happened. He also fought tirelessly for the individual in the courts while at the same time taking down the Governor Leche political system in Louisiana. He was a member of the Huey Long Law Firm, Chairman of the La Public Service Commission, Chairman of the Louisiana Democratic Central Committee and was the Federal Prosecutor of the Western Region of Louisiana. His floor fights at the Democratic National Conventions led to the seating of several controversial delegations. To read more about life during the great depression and several failed federal attempts go to Google Books and search for “I Called Him Grand Dad”. Eventually Fields was not reappointed as Federal Prosecutor following his work to dismember the totally Roosevelt dedicated Richard Leche organization in Louisiana. He was known best for his integrity, honesty and dedication to his causes. Fields was identified three times on Who’s Who in American Politics and his home town of Farmerville presented him with the award for 50 years of practicing law in Union Parish.

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