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Why 95% of Traders Fail

The Lull Before the Civil Unrest Storm

Politics / Social Issues Nov 07, 2012 - 03:49 AM GMT

By: Jack_D_Douglas

Politics

Best Financial Markets Analysis ArticleVast social revolutions and wars are often preceded by periods of giving up on reforms, despairing withdrawal from public life by the best and brightest, and even peacefulness which seems to have become the normal condition in spite of deep conflicts and growing crises beneath the surfaces of public life. Often, earlier periods of intense conflicts and crises have been overcome and resolved, so it comes to look like that is the normal in life. This lulls most people into assuming their worse fears cannot happen, but this leads them to lowering their guards against growing conflicts and crises, so small ones can more easily cascade down into massive ones. If people expected they could become vast wars or revolutions or implosions, they would take more precautions to prevent that. But when lulled in expecting the worst cannot happen, the worst than they could ever imagine often explodes suddenly.


The cataclysmic French Revolution came after many decades of attempted reforms and conflicts which people had come to think of as unending. It started with new attempts at reforms, then incidents that did not seem so important, then all of it a sudden it exploded. WWI came after so many decades of peace in Europe, in spite of imperial conflicts around the world and an arms race, that most people thought a major war was impossible. Then a single murder in the far away Balkans set in motion an explosive cascade of events that led to a cataclysmic war. The Russian Revolution was preceded by such a long "lull" encouraged by European peace and reforms by the tsar that even Lenin was near despair and was living abroad. After several years of WWI and growing poverty at home, the Russian front imploded and a small event at home triggered a revolution that started small and democratic and then exploded into one of the vastest social revolutions in history. The beginning of WWII on the crucial German-French front was so quiet for so many months after France and Britain had declared war on Germany after it invaded Poland that it was called the "Sitzen Krieg" in Germany, the sit-down war, then it exploded as Germany invaded through the Ardennes. This was repeated near the end of the war as Germany built up its forces secretly for attacking through the Ardennes again.

The American Revolution looked very unlikely until that fateful British march to Concord and Lexington to enforce gun control laws. Then it exploded. The conflicts between the North and South had been so intense for so many decades, off and on, and then resolved again and again by major compromises that the Ante-Bellum period of the 1850's seemed another replay of that scenario. Then all of a sudden there was a small incident near Charleston, moves to secession, calling up the Northern troops and an explosion of war vastly more ghastly than Americans imagined possible. War between Japan and Germany and the U.S. had been put off so many times and so long that Pearl Harbor came as quite a shock to most Americans. The 9/11 attacks on the U.S. were just as shocking all over again.

In the early years of this new century, the U.S. had used soaring paper money and paper-asset inflation to fuel a great Bubble and apparent "prosperity" over twenty years and repeated crises [1980, 1987, 1990, 2000] were ended by pumping out more paper money and inflating assets [both paper and houses after the Nasdaq Crash in 2000] that the Fed and almost all economists and Bankers and speculators declared we had entered an Age of The Great Moderation in which financial crises were impossible, as Bernanke declared with gusto. Then housing and stocks started slowly cascading down, then did so more rapidly, then one Big Bank was hit by a sudden crisis and had to be "saved" from implosion, then others followed, then suddenly one weekend Lehman imploded and the the whole top of the U.S. financial system imploded and had to be taken over by the U.S. to save it from what looked like total implosion. The Great Moderation was suddenly replaced by The Greatest Global Financial Crisis in history. Europe and the rest of the world soon followed the U.S. into growing crisis.

By pouting out vast and soaring trillions and using vast distortions of the System [such as Quantitative Easing by the Fed] to hold the System up, they managed in the past several years to stop the accelerating cascade down and have kept it bumping along the bottom in official statistics like the GDP and unemployment, while the debts and distortions and all the real crises keep growing. The apparent bump up in the official stats on GDP are an illusion, below the real rate of inflation for GDP, while real unemployment and all the other real economic crises keep growing.


We're now in a lull before a vast, revolutionary storm. The U.S. is sinking faster and faster in all the ways vital to the future of our society, from the The Great Global Economic-Financial Crisis which the U.S. produced with insane Big Bank speculations and corruption to educational decline and bureaucratic strangulation to losing imperials wars around the world to political deadlock. I'm sure any intelligent American who is honest with himself can quickly write down a long list of the crucial ways in which the U.S. is declining now. Maybe half of Americans are too ignorant about the world or lack the intelligence to see all of this Big Picture of Crisis and Decline. They are confused and mad and despairing and see no way out, but assume the Republicrat System will go on and on and are trying merely to fit in and keep or get a job with a livable wage for them and their families. Even some knowledgeable and intelligent people see what is happening but see no exit and despair and simply withdraw and hide from it all, implicitly or explicitly assuming The System will just keep getting worse and worse and never end.

But nations, like individuals and groups and companies, cannot simply drift downward faster and faster into worse and worse crises they patch up but cannot escape or reverse. We've been doing that now for decades, as France and Russia did before their vast social Revolutions, as the nations did during long decades of peaceful imperial conflicts before the utterly immense conflicts of the American Civil War, WWI and WWII. There comes a time finally when the accelerating crises and sufferings and rages become too much to bear and something, often a seemingly small event like a murder of a young man in the Balkans, or an attack by "hotheads" on a small fort near Charleston, sets off an explosive cascade of events that quickly leads to a vast social explosion.

The U.S. is now rushing downward along all vital dimensions of social life. If this continues much longer, the U.S. will simply implode and that will lead to vast social revolution or revolutions. But maybe the vast social revolution will come before implosion.

The one thing we can be sure of is that we have sunk so far so long and are now accelerating down so fast that this cannot continue long without producing an implosion or a vast social revolution.

Jack D. Douglas [send him mail] is a retired professor of sociology from the University of California at San Diego. He has published widely on all major aspects of human beings, most notably The Myth of the Welfare State.

http://www.lewrockwell.com

    © 2012 Copyright Jack D. Douglas / LewRockwell.com - All Rights Reserved
    Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


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