Classroom vs. Real World
September 25, 2008
The scramble for American Eagles and other bullion coins continues on the market. Supplies just don't keep up with the insatiable demand from buyers who believe they are a hedge against the financial crisis afflicting the country.
Perhaps the interesting thing revealed by the news media in the last few hours is the level of skepticism expressed by average Americans about the crisis. Calls to Washington, D.C., congressional offices seem to be running against the bailout proposal of the Treasury secretary and the chairman of the Federal Reserve.
Is this an example of the "What, me worry?" attitude of Mad Magazine's Alfred E. Neuman? Is it disbelief that a crisis exists? Or is in disbelief that the bailout will do any good?
All of the above?
When I was taught economics in college 35 years ago, the professors often mentioned how much more economically sophisticated we were today as compared to the time of the Great Depression when the Federal Reserve and the Treasury did not act to prevent the 1929 stock market crash from becoming the Depression it became with unemployment at a quarter of the work force in 1933 and a home foreclosure level that is used as a yardstick of horror in the present day.
Are we witnessing the fact that we are not any more sophisticated than we were in 1929 and further action to try to prevent the serial collapses of banks will not be taken?
Bullion coin buyers seem to be saying that with their money.
What would my professors say now?
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