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The Great Depression, is history repeating itself? A historical perspective

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By Bob Hoffman

Could we be heading towards a huge stock boom and a resultant great crash? Read on and come to your own conclusions.



Political Gateway - (September 25th 2009) I am going to take you on a historical journey that looks at the Great Depression era, to a lesser extent the 70s recession, and today. It is hoped you will do some of your own research or if you are a teacher, will have your students do some historical research to rebut, buttress, or add to this article. I will link to any who publish such things.

To start, we have to take a look at our Sun and its solar cycles.


THE SUN AND ITS CYCLES

I am not a proponent of Astrology but we are born in a world inundated with all sorts of radiation. Many talk of the 'full moon' and its effects. Perhaps the solar radiation from our sun can have some effect on us too. Our sun goes through cycles where all sorts of activity sends massive amounts of different types of radiation and energy our way. Some cycles emit more, some less.


In my research of the connection between sunpots and solar activity relating to the depressions I found that A.L. Tchijevsky, a Russian professor of Astronomy and Biological Physics during World War I, had already postulated a theory revolving around maximum sunspot activity followed by major wars 5 years later. Tchijevsky spent 30 years in jail in Russia for his views in the early 1900s. I have not read his information but I hope this leads some to ponder how as a 'group' humanity can make 'mob' decisions that are good and bad.

I will try to take this a slightly different view from Tchijevsky as there are quite a few similarities of very low sunspot activity too, although perhaps they are all connected.
There are 3 very special times in the last 100 years where there was significant slow sunspot activity along with very notable solar cycles. Those three times are the 1915 to 1930s, 1969 to 1980, and the 2000s to present. A more vibrant researcher would look back further and I have added some notes showing other times that are eerily similar to the 30s and today.



Below are some notes on these three time periods of slow sunspot activity and other solar cycle extremes. I am in the US and most of the items below specifically deal with the USA.



Droughts
The 1920s saw the start of a drought and from 1930-36 was a horrible drought for the southern US. The worst in history for the USA.

The late 1970s again saw a horrible drought affecting the southern US. The worst since the 1930s.

2000s- A long period of drought is now increasing to be a very bad period. So far it is as bad as the 1970s drought and getting worse. It is expected to go on for some time and the southern US is facing massive water and fire issues.




Hurricanes
1933 was the worst hurricane season on record, until 2005. Hurricanes in 1938 also hit New England. Many more massive canes were prevalent during this time. The hurricanes of 1925 and 1926 tore apart Florida and other states and is generally accepted to have killed the land boom.

In the mid 1970s until around 1980 a land boom arose, again with Florida as a hotspot. The 70s and 80s had the least amount of damage from hurricanes overall due to not many making landfall, the 60s had some horrid ones. The land bust, in my opinion was affected by some very damaging hurricanes like Frederic in 1979 that slammed Alabama and Missouri.
Some of the most powerful hurricanes on record came during this time. They make up a lot of the top ten list too. Camille – 1969, David – 1979, and Anita 1977.


In the 2000s, massive number of hurricanes pounded every square foot of Florida and the entire gulf coast. 2004 and 2005 caused widespread damage and completely obliterated many small cities and almost destroyed New Orleans. Half of Florida lost power and hurricane after hurricane assaulted Florida in 2005. By 2006 the land boom in the US was crashing.

Special Note: You can easily go back in around 80 year increments to see some of the same hurricane craziness. 1775, 1788, 1795 were years of massive hurricanes. 1846 saw a huge one too.

Although it may be circumstantial, a large number of the worst hurricane seasons and individual hurricanes themselves are centered on these solar cycles. Looking at the 2004 and 2005 seasons is surreal with 2005 being the worst ever and Wilma being a top hurricane. Looking at 1925 and 1926 hurricanes that took out Miami and broke the levees in Okeechobee killing thousands. 2005 saw the levees break in New Orleans. Coincidence?




Disease
Do some diseases like H1N1 seem to thrive during these extreme solar cycles?

The Spanish Flu, a strain of H1N1 killed some 30 to 40 million people in 1918. The first Cholera pandemic happened during this time period too.

The 1970s saw a swine flu scare, again H1N1, and a new disease called AIDS. 1968 saw the Hung Kong Flu.

In 2009 we are looking at a swine flu pandemic, again H1N1 with an unknown ending. New strains of drug resistant diseases are coming again like TB and flesh eating viruses.

Special note: Another historical time in the cycle, 1855, saw the ‘third pandemic’ which killed millions.

It would appear that H1N1 loves the weather cycle of drought and hurricanes.





Land Boom

The land boom of the 1920s introduced, to the common folk en mass, long term mortgages, low interest loans, allowed low down payments, and caused a land euphoria that consumed the US. It started crashing as hurricanes pelted the southern states and Florida was the first to really crash.
During the boom Florida was the center of incredible pricing and shady deals but the boom was country wide. Hurricanes took out Florida and other states and so the boom ended.

The land boom of the 1970s was again a thriller of shady practices, strange mortgages, and low down deals. The bust in 79 and 80 coincided with some of the strongest hurricanes on record.

The 2000s again saw a huge land boom. Shady mortgages, low down, and questionable lending systems. Again 2 years of hurricanes pelted Florida and the other states and caused the start of the land crash.

Special note: going back to the 80 year cycles we see the 1850/60s and the 1770s to be eerily similar in the land boom and bust cycles. Going back further to the early 1700-1720 a land boom/crash crashed France’s banking system and almost broke Isaac Newton (of gravity fame).





War

Encapsulating the land booms of the 1920s and 30s were two world wars. These wars involved a lot of the same nations and in each Germany used a kind of warfare that including quick troop movement and sophisticated communication. There was, in America, a tragic event called 'Pearl Harbor'. An event like this only happened one other time in US history, 2001.

Encapsulating the land boom of the 70s, during the Nuclear Peace, were the Vietnam and Afghanistan wars. Each involved the same two major powers of USA and Russia. This period saw US embassies and planes bombed, a terrorist attack on the Olympics, and a unique hostage situation in Iran.

Before the land boom of the 2000s 4 American planes were hijacked with 3 slamming into the pentagon and the two world trade center towers, collapsing the towers. The worst attack on the US since Pearl Harbor. The US, with allies, declared war on Afghanistan and Iraq, conquering both.
The Iraq war was the first time since the beginning of the Nuclear Peace (1945) to have a major power, the US, invade a country without another major power (Russia, China) contesting them. The rhetoric is heating up and sabers are rattling, could we see more war in the near future? Does it mean it will involve the same participants involved in the Iraq and Afghanistan wars?

Notes on War:
It is strange to look at the 80 year cycle and see some odd things throughout history.

In the 1770s-1800 there was basically a world war going on. Somewhat new to that war was a new way of fighting on the ground and using the navy in a new supportive way. Thus was England defeated in the Colonies, a civil war of sorts. This style of fighting was used from then on and perfected. Also France had a civil war too.

Then in the 1860s the US had its civil war. The use of railways to move troops inspired Bismarck in Germany to try a new way of combat using rails for quick troop movements and telegraphs to organize them. This led to a bit of a world war in Europe during that time. This type of warfare became to its height with the use of roads and radios during Hitler’s lightning war of WWII.

WWII saw the use of a new form of combat, aerial and ballistic missile bombardment. It was used to perfection by the US in the Gulf wars recently. However, during this era, a new form of war seems to be in growth. The army of one or few, suicide bombers. This has been used for a few decades, but now it seems like it is being perfected to destabilize countries. Since it is used within civilian areas, this would appear to be the way to neutralize aerial combat and bring on a new way of warfare again.





Stocks and commodities
After the land crash in 1926, banks were in trouble as were the people. Capital was given to banks who promptly used it to buy other banks and make overseas investments.
By 1928 the banks were okay but had too much money. What to do? They make money by lending it however land, business, and other forms of lending were not viable due to the bad economies.
They naturally repeated the mistakes of earlier booms and made low or no interest loans available at very little margins to buy stock. Stock went up 40% in 1928 alone. This continued until the stocks had tripled in value from their early 20s number and then crashed.
This was a world wide crash and caused a major depression.
Gold spiked and an oil boom became all the rage.

The mid 70s saw a stock crash that was world wide in scope and caused a huge depression. During the crash the housing boom continued. Gold spiked in 1980 and then crashed. and the 70s saw a massive oil crisis followed by a huge run up in oil costs.

The 2000s saw stocks just keep rising and then come crashing down. Commodities went up, gold and oil skyrocketed and then crashed.
After the land bust banks were given lots of capital in the form of 0% loans from the government and bailouts. In 2008 and 2009 hey proceeded to buy other banks and make overseas investments, the same thing that happened in 1927 and 1928.
Now the lenders have access to some 27 trillion dollars. Housing, business, and other loan forms (like cars) and not a viable form of income for them so how can they lend it and make money?

Similar to 1928, the DOW in 2009 has seen an increase of over 50% and looks to climb up as the economy is still faltering. Could we be heading towards a stock bubble and crash?





Racism/slavery/Women

It is interesting to note some things on watershed moments of racism and slavery in America coinciding with these Depression eras.

1770s, American Independence. Freedom for slaves taken out of the draft of the constitution and thus insuring legal slavery for a long time to come. This led to upward of 20,000 slaves a year brought to the US.
Women were basically property with little rights.

1850s, 80 years later, times lead to a civil war that ends slavery ensues in America. This stopped the slave trade in the US.
Women were still basically property with little rights.

1920s-30s, 70 years later, KKK becomes a massive political party though by the 30s it imploded. Again a battle ensues this decade over racial laws, lynching, and rights of blacks in America. The south was aflame with hate.
Women were allowed to vote in this time period. 1st woman was elected to the US Senate.

1970s-80s, although not as extreme a sun cycle, it was close, and had a great recession. This was a time, the late 60s and early 70s when massive changes in race relations in America were happening.
Women worked towards equal rights and pay. The equal rights amendment was pushed but has since been abandoned.
1st woman is elected to the US supreme court

2008, A black American, whose father was a black citizen of Kenya, Africa and a white women in Hawaii becomes President of the USA.
Two women, one almost became President, one almost became Vice President.

In 2009 it is estimated that up to 20,000 slaves are brought to the US every year, about the same as the early 1800s.
As in the early 1800s, the government does little about this modern slavery and the media ignores it.




Final weird note:
This 70/80 year sun cycle ends around some wild times and eras.
2010, 1930, 1850, 1770, 1690..
1690? Yea, that was the year of the Salem witch trials. Weird huh?


Update: As I was writing this article I came across a reference to the Russian man who talked about wars and sun cycles. After posting this I received many links from readers about the 80 year cycle.
Thinking I was being a bit original with this article, I have found that this type of cycle has been postulated going back centuries.

I was afraid to post it as I assumed people would think I was crazy (as they usually do when I post a prediction article) but instead of the usual hate mail I received a lot of 'been there done that' type mail.

My next story will be about a possible stock boom and stock crash. We recently had a stock crash, but not a real stock bubble. That should be coming soon and has already started.


Final Update: Sept 25th: Maybe this is an off base article and no stock bubble is on the way. Maybe I am completely wrong.

Then again most of my predictions on the housing, oil, economy, stock market, unions, etc... have come true. See the articles at the upper right of this site and get back to me on that.

 

    


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