Hard Times on the Horizon?

Florida has been hit hard by the housing downturn. At the peak of the housing frenzy, people from all over the world, legal and illegal, flooded into Florida, fueling the burgeoning job market. Banks doled out cash like drunken sailors to housing contractors and mortgage companies, and highways, restaurants, and schools were flooded with newcomers. The economy boomed.

Now the restaurants are empty most of the day, the highways quiet, and the schools back to normal. Many of the illegal workers have returned to their native countries, and the housing market has gone down in flames. And it’s not getting better. During 2007, our home, according to Zillow.com, slid $82,000 from its inflated peak of 2006. During only the first 22 days of 2008, however, the rate of loss accelerated another $15,000. If it loses $73,000 more, we will lose all of the equity we have built up over almost eight years.

The question is whether Florida and Califo
ia is a tip off the iceberg that will sink the entire country, or anomalies that will remain isolated. Only time will tell. If Florida and Califo
ia are indeed precursors of hard times ahead, this downtu
could be long and drawn out, something that our young population has never experienced before. Dwindling consumer demand can lead to mergers, defaults, corporate bankruptcies, and these in turn could lead to layoffs, reduced benefits, and reduced healthcare. Then, the inability to make payments can lead to loss of homes and an extended recession, or worse for the economy.

Recessions in the recent past have been more or less temporary inconveniences that didn't last long. A recession is when we don't spend money because we are afraid to spend it. A depression is when we don't spend money because we don't have any! This time, we're not sure what will transpire because of the housing crisis and the resulting inability or refusal of financial institutions to loan money as liberally as they have in the past. Consumers have to live within their means. Since the economy has been inflated by the false security of overextended credit for many years, this downtu
could be very serious. Home equity is no longer an option for a quick loan to buy that SUV, and we just don't know where this whole sub-prime mess is going. It seems to be spreading exponentially. Our 401Ks, our pension plans, many things are up in the air. n
As I reflected on the awful things that could happen; such as a worldwide depression that would be unprecedented in scope, I thought I caught a glimmer of some silver lining. Regardless of what happens, it might all be good.

When times get rough, we get back to basics. These are the fundamental responsibilities of a compassionate society. What separates us from the brutes and animals is our innate instinct to take care of our helpless, our children, our old folks, and our ill. When things are going good, we tend to accumulate wealth (which we can never get enough of), in deference to our responsibilities to our fellow men and women. We just get distracted. So a little hardship can be a welcome wakeup call.

Think back to what precipitated a major change or transformation in your life. More than likely it was sudden and surprising, and maybe even traumatic. Many people are grateful for an illness, or an accident, or some other tragedy that on the surface seemed unbearable, but after it was all over, they realized that only when everything was taken away did they have the incentive to change. n
Wonderful, compassionate programs resulted from the last depression. Out of the ashes of chaos rose a Phoenix of a compassionate society. Our nation seemed to change ove
ight from flappers and prohibition, to feeding our hungry, and the country became stronger for it. The drugs that are so prevalent in our society today, the excesses we see all around us, remind us of the roaring 20s. The gogo 80s, the roaring 90s, these too have spun out of control, and a correction back to traditional values could be in the cards.

Maybe the universe allows us to become only so decadent before it reminds us where our place is in this vast cosmos really is, which is beside our fellow human beings. As social programs to help the poor and disadvantaged fall prey to bottom lines, and people of all ages and mental conditions find themselves living on the streets with no one caring, with even veterans who have risked their lives for us receiving no help, I believe the universe takes note of that.

It seems to know, better than we, when our unhappiness becomes so severe that we hide that unhappiness in perceived false values, like our money, our homes, and our investments. We fool ourselves that we are in fact happy, while we are so subconsciously sad. Money and things are never where happiness truly is, happiness can only be in the heart. And sometimes, only when all of our things are taken away from us, are we forced into the freedom to overcome our selfish fears and desires and touch our hearts again.

Something that we barely remember how to do. n