We've grown used to the idea of periodic economic declines occurring every 10 years or so. Western countries have been experiencing cyclical downturns since the baby boom population started coming of age. The recession of the early 70's was brought on by OPEC and the oil embargo. When the 80's came along it was high interest rates which brought economic growth to a halt. The recession of the early 90's was the result of runaway deficit spending by governments during a time of excessively high interest rates. The ever incresing tax burden on citizens made growth extremely hard to achieve.
As the 90's rolled on however we entered into a golden age of prosperity. With the bulk of boomers in their maximum earning years the scale of economic expansion in Canada and the U.S reached levels unmatched historically. Money became less expensive as interest rates started falling rapidly, allowing governments to lower taxes. That was followed by the dot com meltdown of course, and now we find ourselves mired in a deep recession...so deep that some are comparing it to the early stages of the Great Depression.
But enough history.
There will be another recession after we dig ourselves out of this whole, and it might be coming sooner than many expect. Over the next 10 or so years we're going to be seeing boomers...who account for roughly one third of the Canadian population, sitting on the economic sidelines in retirement. Looking for a lucrative career? Think geriatric care my friends. If not that, then try the military...times of social upheaval historically bring conflict between nations.
The western world is throwing everything at this recession, to only modest effect. We're at full sail and our cannons are firing full blast at the enemy in front of us, but the one over the horizon will be even more devastating. The United States is already so indebted that they're borrowing money from their grand children's grandchildren. In another 5 years who in their right mind is going to be purchasing a U.S. government bond? I doubt even Bernie Madoff would be able to peddle goverment T-bills, but for early parole I'm betting he'd give it a shot.
In Canada I do see a way out of this mess, imigration of Biblical proportions. Forget learning French as a second language, instead try Spanish, Portugese or better yet Mandarin. Developing nations have plenty of people, but lack the infrastructure currently. We have the infrastructure, but soon we're going to be in short supply of people to run it.
The other option? It'll be every man and woman for themselves I'm afraid to say. Governments will be holding empty guns, all their ammunition spent in confronting the current crisis with nothing left in reserve. If it happens around December of 2012, I'll be converting to the Myan faith.
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As the 90's rolled on however we entered into a golden age of prosperity. With the bulk of boomers in their maximum earning years the scale of economic expansion in Canada and the U.S reached levels unmatched historically. Money became less expensive as interest rates started falling rapidly, allowing governments to lower taxes. That was followed by the dot com meltdown of course, and now we find ourselves mired in a deep recession...so deep that some are comparing it to the early stages of the Great Depression.
But enough history.
There will be another recession after we dig ourselves out of this whole, and it might be coming sooner than many expect. Over the next 10 or so years we're going to be seeing boomers...who account for roughly one third of the Canadian population, sitting on the economic sidelines in retirement. Looking for a lucrative career? Think geriatric care my friends. If not that, then try the military...times of social upheaval historically bring conflict between nations.
The western world is throwing everything at this recession, to only modest effect. We're at full sail and our cannons are firing full blast at the enemy in front of us, but the one over the horizon will be even more devastating. The United States is already so indebted that they're borrowing money from their grand children's grandchildren. In another 5 years who in their right mind is going to be purchasing a U.S. government bond? I doubt even Bernie Madoff would be able to peddle goverment T-bills, but for early parole I'm betting he'd give it a shot.
In Canada I do see a way out of this mess, imigration of Biblical proportions. Forget learning French as a second language, instead try Spanish, Portugese or better yet Mandarin. Developing nations have plenty of people, but lack the infrastructure currently. We have the infrastructure, but soon we're going to be in short supply of people to run it.
The other option? It'll be every man and woman for themselves I'm afraid to say. Governments will be holding empty guns, all their ammunition spent in confronting the current crisis with nothing left in reserve. If it happens around December of 2012, I'll be converting to the Myan faith.
Comments are welcomed, feel free to pass this along via email or through a social network like FaceBook, just click on the ‘Share’ icon below.
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