Thursday, July 23, 2009
It pays to be an optimist!
The Depression dragged on, lives were ruined and poverty spread all over the land. We have all seen pictures of the soup lines and the myriad dispossessed. If one were to graph what the economy looked like during the Great Depression, including the decade or so leading up to it, it would look like this...
That is a chart of real GDP per capita, which is the same as saying national income per capita. Not a pretty sight, to be sure.
However, if there is one lesson to be learned from the Depression it is this...eventually it went away...it ended...and when it ended the nation resumed its upward path of growth and prosperity.
The chart I gave you above shows you a very limited amount of time and that time, without question, was nasty and brutal.
However...with some perspective we can take a different view of the Great Depression.
Take a look at the chart below. It is a chart of the per capita GDP of the United States since 1790...
Quite a different picture! (Can you find the Great Depression??) Look at the recovery at the end of the 1930s and beyond. Viscious up move!!!
There's a very good lesson here...it pays to be an optimist!