In the short term I believe a lot of communities will probably come together for a few days, but much past a week I believe things around here will drop into a deep deep pile of bad smelling stuff.

It's already happening. Right now. Today.

We've already had massive plummets in the market, and if you made less than 6.3% in interest on your cash, you're losing money.

The "run on the bank" of 2008 is the collapse of the mortgage-backed securities scam, and with it, the topping of major financial institutions.

Let me put this in perspective for you.

If you worked at Bear Sterns for a while, maybe 10 years, let's say you had accumulated, oh, say, 5,000 shares of company stock in your 401(k). One year ago today, that would mean your retirement fund was worth (before tax), $735,600. This evening, it's worth $10,000.

If you haven't see it already, have a look at this map of foreclosures by state:
http://bigpicture.typepad.com/comments/2007/02/foreclosure_hea.html

There's no need to worry about a "run on the bank" because hardly anyone has any money there! For a while, th US Savings rate was NEGATIVE 2%.

It's about 0% now:
http://www.csmonitor.com/2007/0802/p02s01-usec.html

25% of Americans have no savings AT ALL:
http://money.cnn.com/2007/04/10/pf/retir...7041108?cnn=yes

Give the speed of news and information, is it likely we'll have a full-on panic? No, I think not. However, I do think that basic lifestyle matters are going to change, permanently, and that is going to be unpleasant for many of us.

Let me give you a perspective on the types of changes that I mean.

The first change is going to be in living arrangements. Watch for more bankrupt kids moving back in with family, and watch for those Mc Mansions turning into multi-family dwellings. What do you need more, a "media room" or another bedroom when 4 people move in?

The second change is the definition of "mandatory" spending.
Sure, there's the easy list -

Cable or Sat TV, magazine Subscriptions, Movies, Junk Food - those are not really that big a deal.

Let's look at what we call "haftas" and think about what a lifestyle change is really about.

Pick one: Housing or Health Insurance. http://www.ama-assn.org/amednews/2007/07/16/gvca0716.htm
18.3% of Americans have none. That number WILL rise.

Pick One: Food or Fuel
Food: http://www.usnews.com/articles/news/2008/03/07/the-growing-food-cost-crisis.html
According to the Department of Agriculture, grocery prices are rising at rates not seen since 1990. On the wholesale market, the country's biggest commodity crops—corn, wheat, and soybeans—are selling at record highs; wheat prices are up nearly 50 percent since the first of the year.

Fuel:
http://www.msnbc.msn.com/id/23550921/
"8:36 p.m. ET, Sun., March. 9, 2008
NEW YORK - U.S. average retail gasoline prices have reached a new high of almost $3.20 per gallon and will likely jump another 20 to 30 cents in the next month, worsening the pain of consumers struggling to make ends meet in an economic downturn"


An economic collapse does not happen one morning when stocks plummet - its more like a giant moonbounce deflating. You see it going, but you can still bounce around for a while.

Also remember that this time, with instant global communications, the possibilities for a "softer" landing might be there.

I know you might not want to think about it, but we speak English here, just like in India, and last I heard, some hugely successful companies like Tata in India are hiring Americans.
http://www.boston.com/news/world/asia/ar...fshoring_twist/

Folks, this stuff happens. Leaders change, times change, an economies ebb and flow. Keep sane, be frugal, and live lean and you'll be just fine.

But if you haven't canceled your cable TV yet...I'd say do it now, and use the money you saved to buy something that you might actually NEED one day.

I'd say that about sums it up.

No they don't happen over night, even the 29 crash didn't happen over night. There were warnings just as there are now, and just like now there are a huge amount of people who said it can't happen. I'm not trying to say it is going to happen this thread was just to get the brain juices flowing.

One of the few positives about my career choice is it's portability and global demand. I can and have gone anywhere in the world and for a premium been able to make more money than I could domestically, while also building my earning potential when I am home. It came with sacrifices, but the bottom line is if our economy goes to heck, I could be on a plane in two weeks to Abu Dhabi and probably double my current income, or head back to Australia and make what I am now in Aussie currency, or wherever major construction activity is going on. Chance favors the prepared mind.

Sure, if the economy tanks bad enough here at home the repercussions are global, but if you have the ability to take advantage of a mobile sort of career, then you can at least capitalize on whatever opportunities are still out there, and there will always be something, unless the whole world goes wonky.

Even within the states, though, there's still going to be plenty of opportunity. Municipal bonds don't feel the same effects as private sector funding programs until things really go to heck. Utilities and infrastructure must be maintained, regardless of what the economy does, or else civilization breaks down really quickly, and there is zero tolerance for that here (the feds would default their overseas investments before they'd let an administration fail like that).

As for the neighborhood/community response, I try to live in locations where the people around me are at least capable of taking care of their own responsibilities. I find communities where the residents will likely have the resources they will need to get by with under duress, and where if I had to re-equip myself it would not be too difficult an undertaking. Most likely there will be a handful of people in our little development that will be lacking, but will have other resources that might be worth something of trade. I would say about 6 weeks would be the absolute limit for my neighborhood before most would run out of essentials and have to seek assistance outside our walls.

Speaking of "transportable skills" - there's a different, less altruistic motivation to my continued role as a volunteer firefighter - and that's the never-ending supply of free training to whatever level I want for medical, hazmat, rescue, firefighting, NIMS & Incident Command - whatever training I can make the time for, I can get, for free.

While I don't necessarily WANT to be a paramedic or registered nurse, I also know that I could - quickly - train up to those levels from where I am now and immediately find gainful employment in those areas. The pay isn't the same as the work I do now, however, it's a skill set that does not really tie to any one geography.

They will make a reality TV show about it.

* The population of the U.S. in 1930 was 123,202,624.
* The population today is 303,669,478.

* There were a lot of farmers then (approx. 7 million), and they were all over, and they grew many crops as a hedge against something wiping out one or two of them.
* There are about a half-million family farms left today; most of the mega farms that supply our food are single-crop farms, and those single crops can extend for many miles. What does your area grow?

* The concept of the government solving their problems was fairly foreign to them.
*Today, the vast majority of Americans expect their governments (federal, state, county, city) to solve their problems.

* More than 15 million people, a quarter of the nation’s workforce, were unemployed.
* Extrapolating that to this point in time, we would be talking about 75 million people out of work.

* 2.25 million boys and girls ages 10–18 worked in factories, canneries, mines, and on farms.
* BAHAHAHAHAHAHA!

* It was second nature for neighbors to help each other.
* Most people today probably don't recognize their neighbors, and don't know their names.

* Most people had at least some problem-solving abilities.
* People today don't know how to change the battery in their car door-opener.

* They didn't have welfare, or the mentality that goes with it.
* Just what do you expect third-generation welfare receipients to be willing or able to do?

* A lot of production was relatively localized.
* What is made in America that is actually useful? And how far is it from you?

* Most goods were made in the U.S.
* Most of our goods are made in China, Indonesia, and Taiwan.

* People knew how to make-do; nothing was wasted.
* A U of AZ study indicates that 40-50% of US edible food never gets eaten. Over $43 billion worth of edible food is estimated to be thrown away. The average American disposes of over a ton of waste per year, every year.

* They lived real lives.
* We have television.

The government/Federal Reserve has been juggling finances and cooking the books for a long time. It will be interesting to see how long they can keep the situation afloat. If they can't, we will probably regress somewhere between 150 and 10,000 years. THAT is what I call the S hitting the F.

And I think the "Great" Depression will be a Sunday School picnic by comparison.

Cynical Sue

A good perspective, but I think one thing you overlook is that those in power today wield far more of it than those from 80 years ago. While teetering on the brink probably plays into their hand well (what do people with power want after all?), actually allowing our civilization to fall over the edge would likely prove counterproductive, otherwise they'd have pushed it over long ago. The threat is almost always much worse than the reality, so I don't ever expect a full on collapse, but several limited crises are quite likely, similar to what we've experienced over my lifetime so far, each seeming to escalate the risk, but really only exacerbating our burden just a little bit more than the previous one.

I cite this most recent calamity avoidance effort as just the sort of thing we can continue to expect. The media whips up an ever increasing cacaphony of urgency that our economy is getting ready to go feet up, then suddenly the feds decide to reduce the interest rate by a relatively significant amount, in reality changing nothing, but effectively saving the day as the markets rally up and suddenly all is well again, the threat having been thwarted, with nothing actually really being done. On the surface, it seems as though we averted an economical killer asteroid yet again, but the reality is nothing about how the vast majority of us run our lives changed any from before this miraculous rescue to after.

We are digging a rather deep hole for ourselves, or rather we are allowing the hole under us to continue to deepen, and I doubt we will ever get out of it again, but I also doubt we will get to the bottom of the hole any time soon either. For all our problems, we still have a far superior armed force to wield around this world. If we got truly desperate, don't you think we would use all the resources available to us to try and recover? If we wanted to take over all the oil fields in the middle east, I have no doubt the US flag would be flying over the entire region in a matter of two weeks or less. It might be a big ethical problem, and the rest of the world might hate us, but not so many would be that willing I think to challenge a desperate giant. Maybe not a plausible option at the moment, but not inconceivable.

I've got to agree with benjammin. I think Western Society as a whole, and I include the U.S., Canada, almost all of Europe is not headed in a good direction. We're less capable of taking care of ourselves, expect government or others to do it for us, and are not good as a whole at paying our way. The U.S. still can, but other nations are not really capable of defending their interests with military action. The U.S. is becoming less prepared to do so mentally, although right now, our military is very, very capable, although stretched thin. The military people I've talked to basically look at our forces as the best trained they have ever been.

I don't think the system is going to fall apart, perhaps not even during my lifetime. However, the direction is bad. When and if a collapse comes, it may truly be global. The economy of the world is really interwined. Some nations provide services, know-how, without making any products. Some nations, such as China, provide the manufacturing. Some nations provide raw materials for production. Some cannot get things going well enough to get much beyond subsitence. Some fit into more than one category, liek the U.S. which exports lots of foods and services and imports lots of manufactured goods. If the markets collapse for the services, the markets for the manufactured goods also collapse, followed by the raw materials. I don't see a fast decline into a barter economy. But we depend on trade for most things. The order of a collapse, how it will happen, what will be needed to cause it, no real idea, although my inkling is that pandemic will be involved, if it happens anytime soon.

Pandemic is a tough thing to predict about how one can deal with it. The best scenario is to catch it, fight it with your immune system, and get over it. Easy to say, not easy to think you will be able to do so. People survived the black death, but it wiped out much of Europe.

Not seeing it in the immediate future, the question should not only be about preparing and how one does it, but how one prepares those who will follow us, especially your kids. EDIT: by no means do this mean I think we should not think about and prepare in case there is a big collapse. You never know when it might come, and one of the best ways to prepare your kids is to prepare yourself, as it rubs off. The guys I know who store food as a matter of course, usually learned it from their parents.