The Reason the Great Recession Isn’t Over Is Because It’s Another “Great Depression”

There’s good news and bad news. The good news is that if you own a portfolio heavily weighted in favor of defense stocks, you may even expect gains in 2018. This is especially true for those who boarded that train early on—that is, before Donald Trump was elected president in 2016. But for everyone else, 2018 and the next few years could be characterized by a recession, if not another and more vicious Great Depression. A correct analysis begins with framing the problem in the right language.

The term “Great Depression” should not be used lightly. It was a terrible period of the 20th century. But the recession that began in 2007-2008 was equally troubling. Indeed, in relative terms, it was worse. And it’s not over yet.

The economists and journalists, who described the socio-economic breakdown resulting from the unraveling of the sub-prime mortgage derivatives as the “Great Recession,” were wrong. It was another great depression—or the greatest depression. Much has been said about an economic recovery, and if Wall Street is any indication, it certainly looks that way. But stocks and related indices tell a minuscule part of the story.

The economic collapse and financial crisis 2008 had as much social impact as it did economic. If the economic aspects have seen some improvement, the social ones have not. It was social in the sense that the 2008 financial crisis ejected millions of Americans (and others in the developed West) from the ranks of the middle class while promoting a handful of them to the plutocracy. Few officials have ever acknowledged the reverse wealth-distribution that the 2008 crisis generated.

The Financial Crisis Has Provoked a Societal Psychosis

It’s an event that has disturbed society in a deep psychological way, in the same way, an adult’s unexamined childhood trauma can cause problems for the rest of his/her life. It’s essential for the world—and the United States, in particular—to address the social damage that the financial greed behind the sub-prime crisis has created.

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