Very generally speaking, these four secular cycles neatly trace the rise and fall of middle class America. The greatest emphasis on our current state results from the fallout of the three most recent "ages", whose impact has been devastating and accelerating.
The Industrial Revolution brought prosperity to many and arguably established the middle class. Its origin is best symbolized by Henry Ford, who not only pioneered the assembly line, but raised the wages of the workers so they could actually afford the product being assembled (Ford automobiles). THIS is how an economy should function with foresight. With time, the Industrial Revolution brought the creation of unions to ensure the newly created wealth was more evenly distributed. Yes, the unions might have gone a tad too far - but consider the ramifications without them. The resolution of World War II with all the destruction elsewhere certainly helped America's economic might, but basically it was a good time to be a member of the American middle class. And this population were prudent savers assuredly influenced by memories and scars from the Depression. They actually had a proper sense of values along with their relative comfort.
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The Age Of Information progressed from newspapers to radio to television to color television to home computers to the internet. With each progression came the dreaded advertisements. The seeds were planted for the establishment of consumerism. One could not escape constant advertisements for everything under the sun when merely trying to read the news, listen to music or watch a tv show. It simply wore the population down over time until we capitulated. Americans couldn't avoid being swayed in their spending habits by the constant and unforgiving bombardment. This was the genesis of "name brands". A pair of functional jeans or sneakers was no longer enough - they had to be the right brands. If a youngster wore Keds instead of Chuck Taylor Converse All-Stars, he was uncool. The seeds were sown and there was no turning back. The competitive behavior of purchases took root with all the social pressures. And the overpriced "correct" items were determined primarily by advertising budgets - not quality. The first step into the indebtedness trap augmented by the rise of the credit card industry (probably one of the very first societal bastardizations of the financial sector). Credit cards fed the ability to buy the proper things when households basically could not afford them - the old "save to buy" morality was dead. Heck, people even bought the televisions subjecting them to the constant advertisements on credit.
Then the rise of the home computer and the internet brought to our attention other things we needed that were not even mentioned by tv and radio. People gasped: "I didn't even realize this or that even existed, but now that I do, I have to have it". It multiplied temptation a thousand-fold and Americans acted on it. The combination of access to new products and the rapid obsolescence of these products through technological advances brought about the term "disposable item". People purposefully acquired stuff fully knowing that its lifespan was temporary and it would soon be replaced by an advanced replacement. Other than perhaps automobiles or trendy fashions, I can think of no other item that an American in the 1950s or 1960s would view in that manner. They bought things to last.
The internet also greatly contributed to changes in investment behavior. Online research and the ability to trade stocks and other vehicles without broker interference and at greatly reduced rates raised awareness and trading activity. Whether or not this was actually a good thing is debatable. It also contributed to shorter term horizons since instant quotes were readily available. Undoubtedly, many Americans succumbed to buying stocks in questionable companies with the abundance of information out there and further succumbed to trading out of them if they didn't meet their expectations right away. This probably also led to chasing mutual fund performance after the gains had already been made. Also to buying stocks just when the "big boys" had decided to bring them back down so they could reload on the backs of bagholders.
So basically the Age Of Information brought the concepts of consumerism and its attendant indebtedness, followed by the advent of investment patsies. In other words, the age of victim identification.
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The Age Of Globalization is somewhat tied to disposable products. If they had it to do over again, trade agreements such as NAFTA and others would have been implemented quite differently. Free trade with countries paying slave wages with horrific working conditions would have been perceived as the competitive roadblocks they are. They crushed whatever was left of American unionization and demolished entire worker industries. Esteemed American corporations fueled their growth by moving manufacturing and even service operations overseas. The combination of automation and overseas labor devastated a substantial portion of our workforce. When you go from a relatively highly paid manufacturing base, to a service economy - only to lose even much of the service economy to foreign replacements, you are in trouble.
All one has to do is look at the back of any piece of electronics. You will see "Made in China", "Made In Mexico" or "Made in Taiwan". (Yes, some will say "Designed in America" or "Designed in Britain" - but the "Assembled in" or "Made in China" is always there). Look at just about anything bought at a discount store and it's the same. Other than food, it would be fascinating if Target, Walmart or even Best Buy were compelled to admit the exact percentage of their products that are made elsewhere.
The Age Of Globalization also neatly dovetails with the disposability of products. You make 'em cheap to last a short period and you replace 'em. Not only because the inexpensive ones are not well made, but because even the more expensive ones that are well manufactured have a short shelf life. The buyer realizes that technology will shortly pass them by. HDTVs are probably the best example of this. Purchasers know that they'll be replacing even the best ones within a few years. I defy anyone to claim they bought a first generation plasma HDTV and have not since upgraded. (Unless they're homeless or unemployed and on food stamps - but that's a different story).
America lost big time in the Age Of Globalization. We were good at R&D, only to nailed by a combination of low wage countries co-opting our technology, aggravated by our own corporations relocating their workforces overseas in search of greater profits. If only these corporations had even a modicum of a sense of patriotism things would be very different. Patriotism has always been the missing ingredient with corporations. They are quick to take advantage of tax breaks, but have no conception of their responsibility to the nation that allows the same breaks. This will never change - they are takers, not givers. They would lay off every American employee without a second thought if it would increase their profit margin.
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The three "ages" above pale in importance to the middle class relative to the impact of the Age Of The Financial Sector. The Industrial Revolution was pretty much all good. The other "ages" at least had an initial good aspect. But the Financial Industry has become an uncompromisingly destructive force. It rides a pale horse and has brought hell with it. Its present condition has nothing to do with the betterment of mankind. It has spawned an army of psychopaths. These degenerates view their customers solely as beings from whom they can extort money. Parties on whom they can prey.
( Now this applies to the Wall Street-type TBTF banks - not the small banks and credit unions who have retained the old tried and true business model. You know, the ones that must rely on their performance rather than government handouts ).
If the "foul" financial system were to be viewed as a zero-sum game, their goal would be to extract each penny from the losing side. That is their religion and whole meaning of life. They would drive up to a blind street beggar in their BMW and empty his money can if it had any bills in it. But they actually have to do the equivalent with more respected gentlemen. By creating wacked financial products and then going through the hassle of getting them AAA rated and then pawning them off on the unsuspecting. This deviousness in their everyday "transactions" is not considered when they bemoan their long work hours. (Their justification for exorbitant compensation). I'm not entirely sure that spending long hours trying to figure out to to screw the other guy can accurately be defined as work. But the cumulative creations of these psychotics have introduced citizens to the trendy new term "austerity measures". And to think the previous latest jargon "moral hazard", somehow passed from view even though it's still out there in force. There's something about austerity following moral hazard that just doesn't seem quite right. As though it's not fair or something like that. A second grader might question whether this is right or not. Odd that a recent toddler still learning how to read and count would realize the situation that confounds adults.
Probably the biggest problem is that Big Banks now derive the bulk of their income through dark pool, off balance sheet, unregulated products. These derivatives barely contribute to economic growth. Of late, they definitely have actually detracted from it. Why such innovations continue to evolve and prosper is beyond comprehension. It's as though a pension fund manager or other trustee of funds needs to say they are involved in the latest, most supposedly sophisticated products. The fact that they really don't understand them is irrelevant. After all, Lloyd Blankfein and others have testified that they only make a market in this toxic trash as a service because "sophisticated investors" knowingly make their investing decisions and want to get positioned.
In America and worldwide, public involvement with the parties pushing these exotic creations has resulted in public indebtedness well beyond private debt. The brutal combination of entire nations feeling compelled to honor what's owed to the same financial institutions who led them to slaughter, while at the same time using taxpayer money to bail them out of their own obligations, is incomprehensible. It simply doesn't make sense unless one applies the meaning of the latest market buzzword, "crony capitalism". And supplements this by the recently coined phrase "Big Bank gains are privatized, losses are socialized". Then it all becomes clear.
These institutions must be broken up and their political power broken. If not, the Age Of The Financial Sector will be the last "age" of the world as we now know it. The middle class will move backwards in time to their serfdom status that existed before the Industrial Revolution. Backwards evolution is assuredly not what people expected in the 21st century, but it's taking place right in front of our eyes.
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