I have this distinct feeling that we're watching a pivotal point in world history unfold before our eyes. And I'm not at all confident in my abilities to lay out something that rises to that level.
However, I'll start here:
Lots of bloggers (and blog commenters) around me seem to have taken this opportunity to espouse the path of "Get greedy when others are fearful" insofar as stocks and investing are concerned. "Now's the time to buy," they write. "Everyone's running scared! Bargains abound!"
Well, lots of folks ARE running scared. No denying that. But as for buying stocks hand-over-fist, well, I can't go there. I just can't.
For my part — and I've felt this way for a year, at least — I suspect that we're staring down the barrel of a pretty high-velocity poopstorm. Not one to be taken (or "bought") lightly. One regulatory or legislative misstep here or there, one really bad decision from Someone Who Matters, and that's all it'll take: Down Goes Frazier. (I'd also be the first to admit that "doing nothing" would be a monumental mistake as well.)
So have I gone all Chicken Little? Perhaps.
But I figure that my trepidation is largely a function of my watching people interact on a daily basis. Everyone — and I mean everyone — seems to want something for nothing. Or, at least, "something big" for "something negligible." And they feel they deserve it.
And for the last twenty-odd years, they've gotten it.
Most of Wall Street is guilty of this. ("Risk? Hardly. Our mathematical black-box models eliminated that.")
Generations X (mine) and Y are guilty of this. ("I deserve a mid-five-digit salary right out of college!")
Lots of Joe and Jane Sixpacks are guilty of this. ("Gimme lots of services. Lots. Oh, and a big ol' tax break.")
Underwater, nothing-down homebuyers are guilty of this. ("No, really! I'm entitled to a mid-six-digit profit on my home!")
And yes ... I, too, am guilty of this. (Sure enjoyed those zero-percent transfer offers. Easy money.)
And now the piper wants to be paid.
So the question begs: Who's going to pay?
In one way or another, we all are.
If a country is this reliant on an infinite expansion of debt and credit, and if any sizeable constriction in said credit issuance sends the financial system into convulsions, then how exactly can anyone with even a smidge of common economic sense feel good about our system going forward?
Tell me, please. I'm all ears.