Another Great Depression?

[OakLeaf]

A lot of banking regulations were put into place after the Great Depression to hopefully prevent anything that widespread from ever happening again. We may be seeing those safeguards put to the test in the coming months/years.

The worst thing people can do right now is panic.

I don't want to start a panic, but most of those regulations were repealed beginning in the mid-1970s and continuing at an accelerating pace through the present...

[NbyNW]

I don't want to start a panic, but most of those regulations were repealed beginning in the mid-1970s and continuing at an accelerating pace through the present...

Wow, so nothing happened between 1933 and 1968? huh.
I'm not sure if this timeline's focus on more recent events means that consumer protections are disappearing faster than in the past.

[mimitabby]

Wow, so nothing happened between 1933 and 1968? huh.
I'm not sure if this timeline's focus on more recent events means that consumer protections are disappearing faster than in the past.

yes, that is correct. The banks were very stable for those years. (that was while the people who remembered the mess were still in power!)

[Crankin]

Well, why do people put more than the insured $100 K in a bank account?? I want to say the Dr. Phil line, "What were you thinking?" I mean, who would invest all of that money in an account getting 3% interest? Then they get mad when their savings over the $100K amount may be in jeopardy! I am not one who is super well versed in all things financial, but that message is clearly on the all of the doors and windows of all banks. It seems to me, the more people stand in line and yank their money out, the worse things will get.
I remember thinking the same thing with the Lincoln Thrift debacle. At the time, I lived in Phx and these were on every corner. But it was clear that they were not traditional banks and the accounts weren't insured. Sure, the Keating 5 were real sleazeballs, but again, who would put their money in an institution like that? It was bad enough that I bought my first house from Mr. Keating (Continental Homes), but at least the city of Chandler changed the name of Keating Drive after the scandal.
It wouldn't hurt for everyone to look at their finances and see where things can be tightened up. But I guess I am one of the few who sees the glass as half full. This is a cycle that has happened at least 3 times since I graduated from college.

[GLC1968]

The worst thing people can do right now is panic.

The best thing people can do right now is pay down their debt as much as possible.

True, on both counts.

The difference between now and the 1930's though is that today's economy is so extremely oil dependent. In addition, our world population is larger and our food supply is very centralized and also oil dependent. Personally, I think things have the potential to be MUCH worse than they were in the first Great Depression. Will it happen? Hard to say. Back then, most people knew how to do things by hand and how to grow their own food. Our nation still had many small and family farmers and our city populations were much less dense. Today, not so much. Financial problems and unemployment aside, I think that food is going to get ridiculously expensive and sparse in the very near future. As it is, people are already starting to have to choose between gas in the car and food on the table. What happens when they have to figure 'heat in the house' into that equation?

Yep, count me in the 'worried' group.

[BleeckerSt_Girl]

Things actually have the potential for being much worse this time around.

[Blueberry]

GLC-

Are you guys moved? Have you ridden into work yet? Just curious as to how it's going

CA

[pll]

Liquidity for a small business? Liquidity for a big purchase in the near term?

Well, why do people put more than the insured $100 K in a bank account?? I want to say the Dr. Phil line, "What were you thinking?" I mean, who would invest all of that money in an account getting 3% interest?

[tulip]

I'm buying a house, as some of you know. This is my third house purchase. It's quite a simple house, and quite a low price, well within my means. My credit is great, and I'm a good catch for a lender! The mortgage payments will be several hundred dollars less than my current rent.

It's been quite a ride to get approved this time around. Yesterday I got official notice of approval by the lender. Part of it may be that it's an FHA loan, but I think that lenders are being super careful and scrutinizing everything. Jeez, when I bought my house in DC (double this house!) it was practically automatic. I was biting my nails over this one...and will continue to do so until they give me the key.

Once I get the key, however, I'm putting in a veggie garden and putting up a clothes line. Oh, and I also have to build a kitchen. Details, details.

[Fredwina]

with IndyMac, they were giving cashiers check to people who pulled their money out. Some bank were slapping 8 week hold when they were deposited, though.

[Pax]

I'm buying a house, as some of you know. This is my third house purchase. It's quite a simple house, and quite a low price, well within my means. My credit is great, and I'm a good catch for a lender! The mortgage payments will be several hundred dollars less than my current rent...

We're a few weeks ahead of you (we already closed) but our situations are really similar. We could have bought a much bigger house that was further from work but we decided that a smaller/less expensive house that is bikeable/walkable to work, groceries, shopping was a truly sensible choice. It's nice to know that if the economy crashes and burns we'll be able to afford our little house and can leave our cars parked as long as necessary.