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  • The Real Great Depression

    The Real Great Depression

    The depression of 1929 is the wrong model for the current economic crisis

    By SCOTT REYNOLDS NELSON

    Editor's Note: I caught up with Professor Scott Nelson at his office at the College of William and Mary in Williamsburg, Virginia last week. As I write my book on the economy and where it's headed I'm always glad to talk to a historian to get a professional's perspective and share notes. I assert in my book that as serious consumer demand and financial crisis led depressions go, the one that is developing will be epic. However, our current period is unlike the pre-1930s depression era. That depression was triggered by the crash of 1929 but primarily caused by bad monetary policy that exacerbated the debt deflation that followed from consumer over-indebtedness. Weakly structured consumer lending and manufacturing sectors led a sudden decline in consumer purchasing power. Demand crashed. The US depression was then quickly transmitted throughout the world via financial markets, then more slowly through disturbances in trade, which were multiplied by politically motivated disastrous trade policies, and finally war.

    Our current episode has more in common with the 1870s depression which, as Nelson notes, was considerably worse. It was primarily caused by over-indebtedness in the commercial real estate sector, which mortgages were based on new forms of financing which were intermingled on the balance sheets of commercial banks with less rarefied assets that the banks added by making business loans. The era, as the poster to the left depicts, was one of broad based public participation in credit financed asset price inflation and speculation. When the commercial real estate market crashed, it took down the banks and caused the market for commercial credit to seize up, much as we are seeing today. Small businesses were hit especially hard. Unemployment spiked and a severe and lengthy depression ensued as financial markets throughout the world suffered, followed by international trade. The crisis emanated from Europe. It was the beginning of the end of Europe's dominance as the center of global economic power. Read on for the full story. Sign up here to be notified when my book is published. - Eric Janszen

    As a historian who works on the 19th century, I have been reading my newspaper with a considerable sense of dread. While many commentators on the recent mortgage and banking crisis have drawn parallels to the Great Depression of 1929, that comparison is not particularly apt. Two years ago, I began research on the Panic of 1873, an event of some interest to my colleagues in American business and labor history but probably unknown to everyone else. But as I turn the crank on the microfilm reader, I have been hearing weird echoes of recent events.

    When commentators invoke 1929, I am dubious. According to most historians and economists, that depression had more to do with overlarge factory inventories, a stock-market crash, and Germany's inability to pay back war debts, which then led to continuing strain on British gold reserves. None of those factors is really an issue now. Contemporary industries have very sensitive controls for trimming production as consumption declines; our current stock-market dip followed bank problems that emerged more than a year ago; and there are no serious international problems with gold reserves, simply because banks no longer peg their lending to them.

    In fact, the current economic woes look a lot like what my 96-year-old grandmother still calls "the real Great Depression." She pinched pennies in the 1930s, but she says that times were not nearly so bad as the depression her grandparents went through. That crash came in 1873 and lasted more than four years. It looks much more like our current crisis.

    The problems had emerged around 1870, starting in Europe. In the Austro-Hungarian Empire, formed in 1867, in the states unified by Prussia into the German empire, and in France, the emperors supported a flowering of new lending institutions that issued mortgages for municipal and residential construction, especially in the capitals of Vienna, Berlin, and Paris. Mortgages were easier to obtain than before, and a building boom commenced. Land values seemed to climb and climb; borrowers ravenously assumed more and more credit, using unbuilt or half-built houses as collateral. The most marvelous spots for sightseers in the three cities today are the magisterial buildings erected in the so-called founder period.

    But the economic fundamentals were shaky. Wheat exporters from Russia and Central Europe faced a new international competitor who drastically undersold them. The 19th-century version of containers manufactured in China and bound for Wal-Mart consisted of produce from farmers in the American Midwest. They used grain elevators, conveyer belts, and massive steam ships to export train loads of wheat to abroad. Britain, the biggest importer of wheat, shifted to the cheap stuff quite suddenly around 1871. By 1872 kerosene and manufactured food were rocketing out of America's heartland, undermining rapeseed, flour, and beef prices. The crash came in Central Europe in May 1873, as it became clear that the region's assumptions about continual economic growth were too optimistic. Europeans faced what they came to call the American Commercial Invasion. A new industrial superpower had arrived, one whose low costs threatened European trade and a European way of life.

    As continental banks tumbled, British banks held back their capital, unsure of which institutions were most involved in the mortgage crisis. The cost to borrow money from another bank — the interbank lending rate — reached impossibly high rates. This banking crisis hit the United States in the fall of 1873. Railroad companies tumbled first. They had crafted complex financial instruments that promised a fixed return, though few understood the underlying object that was guaranteed to investors in case of default. (Answer: nothing). The bonds had sold well at first, but they had tumbled after 1871 as investors began to doubt their value, prices weakened, and many railroads took on short-term bank loans to continue laying track. Then, as short-term lending rates skyrocketed across the Atlantic in 1873, the railroads were in trouble. When the railroad financier Jay Cooke proved unable to pay off his debts, the stock market crashed in September, closing hundreds of banks over the next three years. The panic continued for more than four years in the United States and for nearly six years in Europe.

    The long-term effects of the Panic of 1873 were perverse. For the largest manufacturing companies in the United States — those with guaranteed contracts and the ability to make rebate deals with the railroads — the Panic years were golden. Andrew Carnegie, Cyrus McCormick, and John D. Rockefeller had enough capital reserves to finance their own continuing growth. For smaller industrial firms that relied on seasonal demand and outside capital, the situation was dire. As capital reserves dried up, so did their industries. Carnegie and Rockefeller bought out their competitors at fire-sale prices. The Gilded Age in the United States, as far as industrial concentration was concerned, had begun.

    As the panic deepened, ordinary Americans suffered terribly. A cigar maker named Samuel Gompers who was young in 1873 later recalled that with the panic, "economic organization crumbled with some primeval upheaval." Between 1873 and 1877, as many smaller factories and workshops shuttered their doors, tens of thousands of workers — many former Civil War soldiers — became transients. The terms "tramp" and "bum," both indirect references to former soldiers, became commonplace American terms. Relief rolls exploded in major cities, with 25-percent unemployment (100,000 workers) in New York City alone. Unemployed workers demonstrated in Boston, Chicago, and New York in the winter of 1873-74 demanding public work. In New York's Tompkins Square in 1874, police entered the crowd with clubs and beat up thousands of men and women. The most violent strikes in American history followed the panic, including by the secret labor group known as the Molly Maguires in Pennsylvania's coal fields in 1875, when masked workmen exchanged gunfire with the "Coal and Iron Police," a private force commissioned by the state. A nationwide railroad strike followed in 1877, in which mobs destroyed railway hubs in Pittsburgh, Chicago, and Cumberland, Md.

    In Central and Eastern Europe, times were even harder. Many political analysts blamed the crisis on a combination of foreign banks and Jews. Nationalistic political leaders (or agents of the Russian czar) embraced a new, sophisticated brand of anti-Semitism that proved appealing to thousands who had lost their livelihoods in the panic. Anti-Jewish pogroms followed in the 1880s, particularly in Russia and Ukraine. Heartland communities large and small had found a scapegoat: aliens in their own midst.

    The echoes of the past in the current problems with residential mortgages trouble me. Loans after about 2001 were issued to first-time home buyers who signed up for adjustable rate mortgages they could likely never pay off, even in the best of times. Real-estate speculators, hoping to flip properties, overextended themselves, assuming that home prices would keep climbing. Those debts were wrapped in complex securities that mortgage companies and other entrepreneurial banks then sold to other banks; concerned about the stability of those securities, banks then bought a kind of insurance policy called a credit-derivative swap, which risk managers imagined would protect their investments. More than two million foreclosure filings — default notices, auction-sale notices, and bank repossessions — were reported in 2007. By then trillions of dollars were already invested in this credit-derivative market. Were those new financial instruments resilient enough to cover all the risk? (Answer: no.) As in 1873, a complex financial pyramid rested on a pinhead. Banks are hoarding cash. Banks that hoard cash do not make short-term loans. Businesses large and small now face a potential dearth of short-term credit to buy raw materials, ship their products, and keep goods on shelves.

    If there are lessons from 1873, they are different from those of 1929. Most important, when banks fall on Wall Street, they stop all the traffic on Main Street — for a very long time. The protracted reconstruction of banks in the United States and Europe created widespread unemployment. Unions (previously illegal in much of the world) flourished but were then destroyed by corporate institutions that learned to operate on the edge of the law. In Europe, politicians found their scapegoats in Jews, on the fringes of the economy. (Americans, on the other hand, mostly blamed themselves; many began to embrace what would later be called fundamentalist religion.)

    The post-panic winners, even after the bailout, might be those firms — financial and otherwise — that have substantial cash reserves. A widespread consolidation of industries may be on the horizon, along with a nationalistic response of high tariff barriers, a decline in international trade, and scapegoating of immigrant competitors for scarce jobs. The failure in July of the World Trade Organization talks begun in Doha seven years ago suggests a new wave of protectionism may be on the way.

    In the end, the Panic of 1873 demonstrated that the center of gravity for the world's credit had shifted west — from Central Europe toward the United States. The current panic suggests a further shift — from the United States to China and India. Beyond that I would not hazard a guess. I still have microfilm to read.

    Scott Reynolds Nelson is a professor of history at the College of William and Mary. Among his books is Steel Drivin' Man: John Henry, the Untold Story of an American legend (Oxford University Press, 2006).

    Republished with permission of the author Scott Reynolds Nelson and the publisher The Chronicle Review.


    iTulip Select: The Investment Thesis for the Next Cycle™
    __________________________________________________

    To receive the iTulip Newsletter or iTulip Alerts, Join our FREE Email Mailing List

    Copyright © iTulip, Inc. 1998 - 2007 All Rights Reserved

    All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Nothing appearing on this website should be considered a recommendation to buy or to sell any security or related financial instrument. iTulip, Inc. is not liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. Full Disclaimer
    Last edited by FRED; 10-06-08, 04:20 PM.
    Ed.

  • #2
    Re: The Real Great Depression

    Originally posted by FRED View Post
    The post-panic winners, even after the bailout, might be those firms — financial and otherwise — that have substantial cash reserves. A widespread consolidation of industries may be on the horizon, along with a nationalistic response of high tariff barriers, a decline in international trade, and scapegoating of immigrant competitors for scarce jobs. The failure in July of the World Trade Organization talks begun in Doha seven years ago suggests a new wave of protectionism may be on the way.

    In the end, the Panic of 1873 demonstrated that the center of gravity for the world's credit had shifted west — from Central Europe toward the United States. The current panic suggests a further shift — from the United States to China and India. Beyond that I would not hazard a guess. I still have microfilm to read.
    Excellent, simply excellent. A hoary maxim holds that history repeats, and so it shall so long as human nature remains fundamentally the same. Dr. Nelson's knowledge of the past helps us to discern dim outlines of what we might soon encounter.

    He concludes that a reversal of the great global expansion of the past decade or two is in store for us (i.e., high tariff barriers, reversal of globalization, and protectionism). Are there implications here for the iTulip thesis? For example, if global commerce constricts, might this result in scarcity of goods, monopoly pricing power, and resurgent domestic production and distribution? What else might await us if the Panic of 1873 is the relevant historical lesson?

    Comment


    • #3
      Re: The Real Great Depression

      Great piece.

      However it would be useful to hear about how we got out of this "depression" induced by the panic of 1873.

      According to Wikipedia, the economic downturn lasted until 1879 (therefore, much shorter than the Great Depression) and ended more quickly in Europe than in the US.

      Any opinions on why either of these were the case?

      What was the US government's policy to address the crisis (if any)?

      Comment


      • #4
        Re: The Real Great Depression

        Originally posted by akrowne View Post
        Great piece.

        However it would be useful to hear about how we got out of this "depression" induced by the panic of 1873.

        According to Wikipedia, the economic downturn lasted until 1879 (therefore, much shorter than the Great Depression) and ended more quickly in Europe than in the US.

        Any opinions on why either of these were the case?

        What was the US government's policy to address the crisis (if any)?
        We still had a gold standard back then.

        There really isn't much in common...

        Comment


        • #5
          Re: The Real Great Depression

          Originally posted by akrowne View Post
          Great piece.

          However it would be useful to hear about how we got out of this "depression" induced by the panic of 1873.

          According to Wikipedia, the economic downturn lasted until 1879 (therefore, much shorter than the Great Depression) and ended more quickly in Europe than in the US.

          Any opinions on why either of these were the case?

          What was the US government's policy to address the crisis (if any)?
          If it's any indication, the term "the dole" was invented then. The government printed money and handed it out.
          Ed.

          Comment


          • #6
            Re: The Real Great Depression

            Originally posted by akrowne View Post
            According to Wikipedia, the economic downturn lasted until 1879 (therefore, much shorter than the Great Depression) and ended more quickly in Europe than in the US.
            This contradicts the article:

            The panic continued for more than four years in the United States and for nearly six years in Europe.
            Wonder which is correct?

            Comment


            • #7
              Re: The Real Great Depression

              EJ clearly has a real winner in his hands. A book prior to publication lives on a single DVD, yea, even a CD and can be reproduced in any nation, translated into any language and printing and distribution are always going to be available. Publishers are going to survive and prosper.

              Comment


              • #8
                Re: The Real Great Depression

                there is also a marvelous book Rothbard wrote that is available free about the first major depression in the US, in 1819. This as always fueled by real estate debt.

                A great book called The Land Boomers tells of a huge, huge bubble in Australia, fueled once more by cheap credit financing on real estate, and a subsequent crash and depression that is quite monstrous.

                Comment


                • #9
                  Re: The Real Great Depression

                  I've often thought that the Panic of 1873 directly resulted in the New Imperialism era (i.e. "Scramble for Africa"). Europe recovered faster because they worked quickly to extract wealth from specific places in the world, while the US simply continued to consolidate the US (at least until the ridiculous Spanish-American War).

                  Comment


                  • #10
                    Re: The Real Great Depression

                    I can't help but think about this scenario:

                    Babyboomers dropped the towel on the stock market in the crash of 2008 and go all cash...

                    only to get mauled by a highly inflationary environment engineered by CBs to "save" the "financial system"

                    end game: retirement gone, babyboomers finally understand that markets are not free and all of them join iTulip... sorry I mean pitchfork-yielding crowd in Washington, Ottawa (not that we matter), London, Paris...

                    Comment


                    • #11
                      Re: The Real Great Depression

                      Originally posted by LargoWinch View Post
                      I can't help but think about this scenario:

                      Babyboomers dropped the towel on the stock market in the crash of 2008 and go all cash...

                      only to get mauled by a highly inflationary environment engineered by CBs to "save" the "financial system"

                      end game: retirement gone, babyboomers finally understand that markets are not free and all of them join iTulip... sorry I mean pitchfork-yielding crowd in Washington, Ottawa (not that we matter), London, Paris...
                      China's going to buy about $200B treasuries to help bailout the US... to dump an inflation hedge now is silly.

                      Comment


                      • #12
                        Re: The Real Great Depression

                        Originally posted by FRED View Post
                        The Real Great Depression

                        The depression of 1929 is the wrong model for the current economic crisis

                        By SCOTT REYNOLDS NELSON

                        Editor's Note: I caught up with Professor Scott Nelson at his office at the College of William and Mary in Williamsburg, Virginia last week. As I write my book on the economy and where it's headed I'm always glad to talk to a historian to get a professional's perspective and share notes. I assert in my book that as serious consumer demand and financial crisis led depressions go, the one that is developing will be epic. However, our current period is unlike the pre-1930s depression era. That depression was triggered by the crash of 1929 but primarily caused by bad monetary policy that exacerbated the debt deflation that followed from consumer over-indebtedness. Weakly structured consumer lending and manufacturing sectors led a sudden decline in consumer purchasing power. Demand crashed. The US depression was then quickly transmitted throughout the world via financial markets, then more slowly through disturbances in trade, which were multiplied by politically motivated disastrous trade policies, and finally war.

                        Our current episode has more in common with the 1870s depression which, as Nelson notes, was considerably worse. It was primarily caused by over-indebtedness in the commercial real estate sector, which mortgages were based on new forms of financing which were intermingled on the balance sheets of commercial banks with less rarefied assets that the banks added by making business loans. The era, as the poster to the left depicts, was one of broad based public participation in credit financed asset price inflation and speculation. When the commercial real estate market crashed, it took down the banks and caused the market for commercial credit to seize up, much as we are seeing today. Small businesses were hit especially hard. Unemployment spiked and a severe and lengthy depression ensued as financial markets throughout the world suffered, followed by international trade. The crisis emanated from Europe. It was the beginning of the end of Europe's dominance as the center of global economic power. Read on for the full story. Sign up here to be notified when my book is published. - Eric Janszen

                        As a historian who works on the 19th century, I have been reading my newspaper with a considerable sense of dread. While many commentators on the recent mortgage and banking crisis have drawn parallels to the Great Depression of 1929, that comparison is not particularly apt. Two years ago, I began research on the Panic of 1873, an event of some interest to my colleagues in American business and labor history but probably unknown to everyone else. But as I turn the crank on the microfilm reader, I have been hearing weird echoes of recent events.

                        When commentators invoke 1929, I am dubious. According to most historians and economists, that depression had more to do with overlarge factory inventories, a stock-market crash, and Germany's inability to pay back war debts, which then led to continuing strain on British gold reserves. None of those factors is really an issue now. Contemporary industries have very sensitive controls for trimming production as consumption declines; our current stock-market dip followed bank problems that emerged more than a year ago; and there are no serious international problems with gold reserves, simply because banks no longer peg their lending to them.

                        In fact, the current economic woes look a lot like what my 96-year-old grandmother still calls "the real Great Depression." She pinched pennies in the 1930s, but she says that times were not nearly so bad as the depression her grandparents went through. That crash came in 1873 and lasted more than four years. It looks much more like our current crisis.

                        The problems had emerged around 1870, starting in Europe. In the Austro-Hungarian Empire, formed in 1867, in the states unified by Prussia into the German empire, and in France, the emperors supported a flowering of new lending institutions that issued mortgages for municipal and residential construction, especially in the capitals of Vienna, Berlin, and Paris. Mortgages were easier to obtain than before, and a building boom commenced. Land values seemed to climb and climb; borrowers ravenously assumed more and more credit, using unbuilt or half-built houses as collateral. The most marvelous spots for sightseers in the three cities today are the magisterial buildings erected in the so-called founder period.

                        But the economic fundamentals were shaky. Wheat exporters from Russia and Central Europe faced a new international competitor who drastically undersold them. The 19th-century version of containers manufactured in China and bound for Wal-Mart consisted of produce from farmers in the American Midwest. They used grain elevators, conveyer belts, and massive steam ships to export train loads of wheat to abroad. Britain, the biggest importer of wheat, shifted to the cheap stuff quite suddenly around 1871. By 1872 kerosene and manufactured food were rocketing out of America's heartland, undermining rapeseed, flour, and beef prices. The crash came in Central Europe in May 1873, as it became clear that the region's assumptions about continual economic growth were too optimistic. Europeans faced what they came to call the American Commercial Invasion. A new industrial superpower had arrived, one whose low costs threatened European trade and a European way of life.

                        As continental banks tumbled, British banks held back their capital, unsure of which institutions were most involved in the mortgage crisis. The cost to borrow money from another bank — the interbank lending rate — reached impossibly high rates. This banking crisis hit the United States in the fall of 1873. Railroad companies tumbled first. They had crafted complex financial instruments that promised a fixed return, though few understood the underlying object that was guaranteed to investors in case of default. (Answer: nothing). The bonds had sold well at first, but they had tumbled after 1871 as investors began to doubt their value, prices weakened, and many railroads took on short-term bank loans to continue laying track. Then, as short-term lending rates skyrocketed across the Atlantic in 1873, the railroads were in trouble. When the railroad financier Jay Cooke proved unable to pay off his debts, the stock market crashed in September, closing hundreds of banks over the next three years. The panic continued for more than four years in the United States and for nearly six years in Europe.

                        The long-term effects of the Panic of 1873 were perverse. For the largest manufacturing companies in the United States — those with guaranteed contracts and the ability to make rebate deals with the railroads — the Panic years were golden. Andrew Carnegie, Cyrus McCormick, and John D. Rockefeller had enough capital reserves to finance their own continuing growth. For smaller industrial firms that relied on seasonal demand and outside capital, the situation was dire. As capital reserves dried up, so did their industries. Carnegie and Rockefeller bought out their competitors at fire-sale prices. The Gilded Age in the United States, as far as industrial concentration was concerned, had begun.

                        As the panic deepened, ordinary Americans suffered terribly. A cigar maker named Samuel Gompers who was young in 1873 later recalled that with the panic, "economic organization crumbled with some primeval upheaval." Between 1873 and 1877, as many smaller factories and workshops shuttered their doors, tens of thousands of workers — many former Civil War soldiers — became transients. The terms "tramp" and "bum," both indirect references to former soldiers, became commonplace American terms. Relief rolls exploded in major cities, with 25-percent unemployment (100,000 workers) in New York City alone. Unemployed workers demonstrated in Boston, Chicago, and New York in the winter of 1873-74 demanding public work. In New York's Tompkins Square in 1874, police entered the crowd with clubs and beat up thousands of men and women. The most violent strikes in American history followed the panic, including by the secret labor group known as the Molly Maguires in Pennsylvania's coal fields in 1875, when masked workmen exchanged gunfire with the "Coal and Iron Police," a private force commissioned by the state. A nationwide railroad strike followed in 1877, in which mobs destroyed railway hubs in Pittsburgh, Chicago, and Cumberland, Md.

                        In Central and Eastern Europe, times were even harder. Many political analysts blamed the crisis on a combination of foreign banks and Jews. Nationalistic political leaders (or agents of the Russian czar) embraced a new, sophisticated brand of anti-Semitism that proved appealing to thousands who had lost their livelihoods in the panic. Anti-Jewish pogroms followed in the 1880s, particularly in Russia and Ukraine. Heartland communities large and small had found a scapegoat: aliens in their own midst.

                        The echoes of the past in the current problems with residential mortgages trouble me. Loans after about 2001 were issued to first-time home buyers who signed up for adjustable rate mortgages they could likely never pay off, even in the best of times. Real-estate speculators, hoping to flip properties, overextended themselves, assuming that home prices would keep climbing. Those debts were wrapped in complex securities that mortgage companies and other entrepreneurial banks then sold to other banks; concerned about the stability of those securities, banks then bought a kind of insurance policy called a credit-derivative swap, which risk managers imagined would protect their investments. More than two million foreclosure filings — default notices, auction-sale notices, and bank repossessions — were reported in 2007. By then trillions of dollars were already invested in this credit-derivative market. Were those new financial instruments resilient enough to cover all the risk? (Answer: no.) As in 1873, a complex financial pyramid rested on a pinhead. Banks are hoarding cash. Banks that hoard cash do not make short-term loans. Businesses large and small now face a potential dearth of short-term credit to buy raw materials, ship their products, and keep goods on shelves.

                        If there are lessons from 1873, they are different from those of 1929. Most important, when banks fall on Wall Street, they stop all the traffic on Main Street — for a very long time. The protracted reconstruction of banks in the United States and Europe created widespread unemployment. Unions (previously illegal in much of the world) flourished but were then destroyed by corporate institutions that learned to operate on the edge of the law. In Europe, politicians found their scapegoats in Jews, on the fringes of the economy. (Americans, on the other hand, mostly blamed themselves; many began to embrace what would later be called fundamentalist religion.)

                        The post-panic winners, even after the bailout, might be those firms — financial and otherwise — that have substantial cash reserves. A widespread consolidation of industries may be on the horizon, along with a nationalistic response of high tariff barriers, a decline in international trade, and scapegoating of immigrant competitors for scarce jobs. The failure in July of the World Trade Organization talks begun in Doha seven years ago suggests a new wave of protectionism may be on the way.

                        In the end, the Panic of 1873 demonstrated that the center of gravity for the world's credit had shifted west — from Central Europe toward the United States. The current panic suggests a further shift — from the United States to China and India. Beyond that I would not hazard a guess. I still have microfilm to read.

                        Scott Reynolds Nelson is a professor of history at the College of William and Mary. Among his books is Steel Drivin' Man: John Henry, the Untold Story of an American legend (Oxford University Press, 2006).

                        Republished with permission of the author Scott Reynolds Nelson and the publisher The Chronicle Review.


                        iTulip Select: The Investment Thesis for the Next Cycle™
                        __________________________________________________

                        To receive the iTulip Newsletter or iTulip Alerts, Join our FREE Email Mailing List

                        Copyright © iTulip, Inc. 1998 - 2007 All Rights Reserved

                        All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Nothing appearing on this website should be considered a recommendation to buy or to sell any security or related financial instrument. iTulip, Inc. is not liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. Full Disclaimer
                        On 1873, the year after Benito Juarez died, the first full railroad line was inaugurated in Mexico.

                        It is curious. As of what I remember ahving read from the period, The years after the death of Benito Juarez and before the Dictatorship of Profirio Dνaz are considered the most free and democratic period of Mexican History prior to 2000. Also, taking into account the development taken into account during the dictatorship, the period from 1881 to 1910 saw the building of the railway backbone of Mexico, since during that period 90% of all the railroads ever built in Mexico were laid.

                        By Paris Exposition in 1889, Mexico intended to show itself as a modern country where agriculture and mining was the base of wealth. Subsequent loss in the international price of silver, along with a misunderstood move from bimetallic standard to gold standard in 1905 impoverished working masses, making for one of the reasons of Mexican Revolution.
                        sigpic
                        Attention: Electronics Engineer Learning Economics.

                        Comment


                        • #13
                          The Real Great Depression Revisted

                          How did the US Congress respond to the 1870s Depression? This NYTimes article says it all. Required reading for anyone who is hoping for "change."

                          Ed.

                          Comment


                          • #14
                            Re: The Real Great Depression

                            Personally, am I the only iTulip member waiting to hear that EJ is on the Change team and referring to the above, it is going to be an obtuse individual that has not got a clear idea of the challenge ahead, so there are no excuses this time around.

                            Comment


                            • #15
                              Re: The Real Great Depression

                              Originally posted by Chris Coles View Post
                              Personally, am I the only iTulip member waiting to hear that EJ is on the Change team and referring to the above, it is going to be an obtuse individual that has not got a clear idea of the challenge ahead, so there are no excuses this time around.
                              If EJ is not part of the Change team, can we have him in Canada? (We can pay in tar sands and we will build him a bunker ala GRG55 too).

                              Comment

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