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How long will this recession last? The Fed Chariman say until the end of 2009. Others are saying 3 years and the longest I`ve heard is 10 years. Now that is really scary.

I think anywhere between 1-3 years is reasonable. I think 10 years is a little outlandish, but it also really depends on what you are referring to. If you are referring to a plunging stock market, rising unemployment, falling consumer spending, etc..., than I would say in ten years, we might have already recovered from this recession and be in another cyclical recession.

But will we still feel effects from this recession in ten years? Absolutely. Certain regulations, changes in bank policy, and probably in the housing market as well will most likely be observable ten years from now.



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Motivation for Entrepreneurs
Entre-Propel.com

The Fed chairman is saying 2009 ONLY if congress steps in with new forms of bank regulation. One of the telling quotes is that "banks that are too big to fail must be allowed to fail," and that a process should be put in place for such a failure that wouldn`t wreck the entire world economy.

To me, that indicates the government is looking at Citibank and BankAmerica to go under. Not an optimistic view, coming from our executive leadership!

I suspect that this recession isn`t a recession, it`s a fundamental change in the overall structure of civilization. Borrowing from a great book, "The Fourth Turning," which analyzes cycles in history, it seems to me that this recession likely will continue through to around 2020-2025.

Not that it`ll be a continuous recession, but that between now and then, we`ll have a totally different construction in terms of economy and currency. I`m supposing some sort of major world war in there, too. Out of that war would come a reconstruction.

This "recession" isn`t a bank problem. It`s both a sociological problem, and more importantly, a philosophic problem that`s been building for 300 years.

I think this recession has been extended by our so called leaders in Washington in order to implement socialism. there is no other explanation for me that they are changing the natural order of things, everything dies, even companies, but our "leaders" have a better idea.
think back to "ma bell" when she got to big they forced her to break up, now they allow banks to get to big to fail, once they own the banks, they own everything.
the Saudis nationalized the oil fields and our government is just setting up a cover to nationalize our banks.:
we all hear about the housing market and homeowners being "underwater" because values have dropped so much but anyone hear about the realignment of property taxes, I haven`t.
so the question is when will this recession end, I submit not in our life times, but in less than 5 years we will be socialist and think things are better.
just a thought

I`m certain no one on this board and no human can say, its too many variables. Opinions are worthless just keep doing what makes you happy and you`ll be fine. Amazingly society will go on.

Craigs answer does dominate though. This was a known problem for a long time, just not in mainstream culture unfortunately. I guess there just weren`t enough people `tweeting` about it to pick up steam (sense my sarcasim). How quickly everyone has forgotten Ron Pauls entire campaign was about the financial system mess and how banks are going to destroy us, before all this happened.

I don`t buy into the govt owning everything deal, they are the ones that allowed currency production to go private in the first place. Go out and watch one of the 100`s of banking dooms day videos out there from years ago before all this mess. Here is one of the more popular ones: http://www.youtube.com/watch?v=_dmPchuXIXQ

Walk out onto any street in america and ask someone how the banking system really works and they wont have a clue. I don`t either. Shame on us all.


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Guitar Repair - RepairMyGuitar.com - The Guitar Repair Directory

I`m very curious to know what this book said (I haven`t read it) that would suggest this situation would last for this long?

Also, I have difficulty believing that a philosophic problem that has been building for 300 years will be fixed in only 11-16 years.

I do agree that there is most likely a philosophic problem behind this recession...what do you think this problem is?


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Motivation for Entrepreneurs
Entre-Propel.com

"The Fourth Turning."

Radio interview with author Neil Howe on the Coast-to-Coast show.

Setting aside the book, the philosophic impasse is far deeper than various cycles of history.

Back around the 1700s, in the days of Isaac Newton, Kant, and the heyday of German philosophy, we had a basic split in western thinking.

The one side eventually became the romantics, building on the idea that everything is part of everything, and we feel knowledge (somehow) by osmosis.

The other side became the structuralists, holding that every effect has a cause, and the cause is a function of smaller and smaller causes. They became the foundation of what we know as Science.

The problem is that neither philosophy allows for ANY part of the other. In other words, you either can be (and must be) purely logical, analyzing all of existence through intellect alone, or you must be purely sensory. Feelings are the only possible way to understand reality, if you`re coming out of the romantics.

Obviously feelings are fundamental, and our senses are critical to life and existing in the real world. Just as obviously, intellect and analysis are crucial to having goals, making plans, and understanding the world around us.

That being said, neither side has changed. Neither side has developed their philosophy much since those days. Neither side is interested in what difference may exist between feelings and emotions. And so, we`re at a total impasse.

Science on the one hand, knowledge-by-osmosis (or revelation) on the other. And a total chasm between the two.

Modern conservatism tends toward intellect, analysis, and logic, but does make room for feelings and emotions. Modern liberalism tends towards feelings, beliefs without facts, but makes room for some amount of logic.

Philosophers have pretty much abdicated all responsibilities for their writings, and worse, haven`t at all developed to account for hundreds of years of science, technology, information theory, physics, or any thing else at all.

The result is that we now are having to live through the endgame of these two major branches of western thought. Neither side is right, neither side makes total sense, and neither side is at all interested in coming up with a new philosophy.

@CraigL Thanks to the link out to my blog. I also put a post up about how long the "crisis" will last:

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Dave Sohigian
http://www.thegenxfiles.com
Understanding how generations affect our future

Interesting links and arguments. Dave, excellent presentation on the cycle of generations, well done! :)

Craig, if I understand your argument, you are saying that these two conflicting philosophies, now present in the two rival political parties is now coming to a head, correct? So, is this recession the catalyst for this conflict?

I see a lot of merit in this argument, but what I am seeing is that there seemed to be more division in the US over the Iraqi war, rather than fixing this recession. Sure, there is a lot of disagreement over how to fix the recession, but I saw an even larger division over the war. I`m wondering if there was any catalyst, it would be that one.

I see two other conflicting classes...and this conflict has been age old...the "rich" and the "poor". In our case, it is more along the lines of Wall St, vs Main Street, where each doesn`t think the other deserves bailout money. Any thoughts?



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Motivation for Entrepreneurs
Entre-Propel.com

No, I`m rather saying that the current division and polarization of the two ideologies is the natural result of the philosophies. The two ideologies have been present in one or another form, dominant on one or the other side for as long as the United States has existed (and longer).

The recession isn`t the catalyst so much as the natural process. It`s just that this time, it isn`t a partial ending that changes with the next election. We had that back with Reagan.

This time, in conjunction with the historical cycles of the Fourth Turning book, we`re at the overall end of an 80-year conflict.

That conflict, also arising out of the basic philosophies, is between capitalism and socialism.

A lot of people don`t realize that capitalism never had a popular backing in America. Many articles, essays and public debates were written back in the late 1800s into the early 1900s about the overall direction America should take.

At the time, most people felt that socialism would be a much better, more equitable way for the entire population to benefit from the new country. We`d come through the crash of 1893, and before that, the Monroe crash (following Andrew Jackson).

Socialism, presented by Karl Marx, appealed to the then-new unions, the anarchists, the women`s sufferage movement, and the growing industrial revolution.

Capitalism, never really defined or structured, seemed only to be beneficial for the extremely wealthy tycoons----the "Robber Barons."

When Franklin Roosevelt came into office, it was on a general public sentiment that capitalism and "greed" were the same. Rich were massively rich, but the majority of the country was in either agriculture, textiles, factory labor, railroads, or other "blue-collar" jobs.

The past 80 years has been an attempt to finally structure a sort of modified socialism, vaguely like Europe (e.g., Sweden, Norway).

All of it comes from fundamental premises regarding human nature, virtue, honor, justice, equality, and individual freedoms. The anarchists rest on the premises of romanticism. "Business" and the corporate model rests more on structuralism and pragmatism.

Since neither philosophy is fully useful or true, neither ideology can work either.