This blogbook offers, with the aid of various charts, graphs, and tables, a pictorial guide to the 2008 financial crisis.
A Comparison with Japan
The spectacular fall of Japanese markets after 1989, in which land and equity prices followed one another down in a long spiral, inevitably suggests comparisons with the contemporary American predicament. But the comparison provides no cause for optimism, for Japanese households, at the height of the bubble, had a high rate of domestic savings of 15 percent of household income. Yet this cushion did not arrest the fall in equity and real estate values. Household savings, calculated without reference to equities and real estate, have been zero for some time in the United States. And household finances are deeply impaired by high debt and collapsing asset values.
Keep this chart in mind as we go forward and survey US responses to the crisis.
To see the presentation in order, use either the Labels below for each chapter or the Table of Contents for individual entries.
The initial presentation was made in October 2008 and was last updated in January 2009, though I recently substantially expanded the list of sources. Lately, I have been working on a blogbook called Energy Predicament.
My dubious record for 2008 is reviewed here, by some miscreants.
FEELING GLUM AND OUT OF SORTS, PERHAPS A BIT ANGRY?
YOU HAVE EVERY RIGHT TO FEEL THAT WAY.
A good number of my charts first appeared at Contrary Investor. Though oriented toward investors, CI offers a superb analysis of the real economy and its relationship to the financial system. It is an indispensable source not only for individuals but also for any good library. So subscribe, dammit.