On Sun, 09 Dec 2007 11:41:05 -0600, Vic Smith
wrote:

On Sun, 09 Dec 2007 14:33:43 GMT, Short Wave Sportfishing
wrote:


Well, we will probably continue to agree to disagree. :)

I don't think we really disagree, more like we view the consequences
of some breakdowns differently.
I think we can agree the shuttle disasters occurred because "simple"
systems failed. Frankly, for all the admiration I have for the teams
that put the shuttles together, the management side let them and
astronauts down. You may feel differently, but I view both failures
as preventable and unnecessary. The o-ring problem was known,
and so was the ice hitting tiles. They took chances they didn't have
to take. Given the tremendous achievements of the shuttle program
it's difficult to come down on them hard, but that's my opinion.

It's true, but you have to consider humans as a part of the system -
it's not only just the part, but the decisions that lead up to how
that part was utilized.

In both shuttle cases, humans made the decision based on the best
evidence available at the time.

But since I'm here, and you know more this than me, how the hell did
the Great Depression occur, and could it happen again?

Of course it could.

Five conditions are commonly considered necessary for a market crash -
prolonged period of rising stock prices, irrational exuberance, P/E
ratios exceed long-term averages, and extensive use of margin debt and
leverage by market participants. There are other psychological and
monetary conditions, but those are the biggies.

In 1929 you have all five conditions plus economic features like
communications technology (radio/telephone), increasing use of
automobiles, begining of civil aviation, telephone and the power grid
development. Monetary power was held by several corporations and two
or three brokerage houses. Minor houses became involved in heavy
margin activity.

Deep recessions always occur with leading edge indicators. In the
summer of 1929, it was a contracting economy (took much production,
too much money), decreasing confidence in the financial system and
loss of confidence due to a series of financial scandals.

Sound familiar? :)

My real "economic" concern is that we don't produce our own goods, and
China has us by the balls.

So does any number of countries and for a variety of reasons.

Look into it sometime and see what havoc the sub-prime market is
having on smaller Eurpoean countries.

It's scary.