"Europe is dying"

Started Nov 29, 2012 | Discussions thread
Senior MemberPosts: 3,217
Re: Historical change drives society
In reply to boggis the cat, Nov 30, 2012

boggis the cat wrote:

illy wrote:

i think the current consumerism ideal is slowly dying

Consumerism only really evolved in the USA post WWII, when enormous money poured in to the USA to buy goods unavailable in bombed-out Europe and Japan.

This boom, coupled with government schemes to subsidise housing and education for returned service people, led to the average person suddenly having a large surplus of income. Domestic manufacturers started the "consumerism" trend of buying new stuff even when not needed in order to tap into that sea of money.

During the 1970s and 1980s people increasingly stopped spending surplus income and started borrowing to spend on (non productive) consumer goods. This helped spur de-industrialisation as production moved to cheap labour areas to try to bring prices down to where the consumers could afford -- and a vicious cycle took hold that has now led to Walmart prices with Walmart wages.

Now we have simply run out of credit, as the myth of an ever-expanding economy has lost the ability to convince those with money to lend it out -- 'paper wealth' can vanish far faster than it accumulates.

I would expect a gradual return to a more 'normal' economy in Western nations over the next few decades, with investment slowly pulled from the 'paper economy' and redirected into the physical economy. (Any returns on investment that are larger than real economic growth are obviously not tied to reality and thus nonsense, so speculation will fall off as the obvious risks seep into investors consciousness. As populations stabilise then start to decline we'll see 'investment areas' such as housing markets correct as well.)

Hit the nail right on the head with that one.


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