In a stunning example of the plight of the world economy, the Toyota Motor Company – which passed General Motors in 2008 for the record of most vehicles sold worldwide – posted an annual loss of 436.9 billion yen, or $4.4 billion dollars for the fiscal year ending March 2009. This was Toyota’s first annual net loss since the good old days of 1950.
How much did things cost in 1950? According to http://www.thepeoplehistory.com/1950.html,
The yearly inflation rate in the USA was 1.09% A new house averaged $8,450.00 Average wages per year: $3,210.00 Cost of a gallon of Gas: 18 cents Average Cost of a new car: $1,510.00 Stromburg black and white television: $249.95 Ball point pen: $0.25 Samsonite case: $25.00 Clock radio: $59.95
To make matters worse, Toyota is predicting it will lose another 550 billion yen or $5.5 billion dollars for the fiscal year ending March 2010, while global sales drop by almost 15%.
It’s interesting to note that in 1950 the average cost of a new house in the US was about 2 1/2 times the average wage. In 2007, the average wage in the US was about $40,000 and the average cost of a new house [...]
Depressions: Recessions: Money Supply:
A happy shout out to economic historian Price Fishback for reminding us in a piece published in the New York Times that, as bad as things may now seem in the economy, they are nowhere near as bad as during the great depression of the 1930′s in the US.
He begins by saying that economic cycles and downturns are a natural part of the economic cycle [and "nature's" cycle], but that we may be more sensitive to them now because the big downturns have been coming less frequently since the 1980′s. In other words, we may have gotten a little spoiled and less used to the hardships of the normal business cycle [this lag in business cycles may have something to do with the increasingly loose monetary policy of the last several decades, which climaxed during the reign of "Bubbles" Greenspan].
And according to the theories of Soviet economist Nikolai Kondratiev on the nature of economic supercycles, we are basically due for another big downturn in the world economy. In other words, this is all part of the divine plan and this too shall pass.
But comparison with the Great Depression just doesn’t hold up. Yes the stock market is [...]