A friend recently forwarded me an e-mail to comment on. This friend is a very intelligent and informed woman, but the e-mail had raised concerns that she wanted addressed.
The e-mail itself was a fairly typical example of the world-is-ending sort, with a focus on some sort of ill-defined debt collapse, which would wreak havoc around the world. The interesting thing about this one was not the historical or economic illiteracy, but that it said that one of the highest priorities readers should have is to buy lots of “socks” before the collapse. This is what I call a scary-movie e-mail—a basically commercial product designed to make money by scaring you.
Although the e-mail was bogus, the concerns my friend had are real. Many people feel that something is out of whack here, and not having a sense of what the real problems are, why they exist, or how they might play out makes them vulnerable to this type of thing, even though they rationally know they should not be. Just like sitting up late listening to the wind and the creaking house after reading Stephen King.
The best remedy for uncertainty is knowledge. Immediately after looking at that e-mail and responding, I pulled up a paper that I recommend as a good documentary version, as opposed to the scary-movie version, of what the real problems and risks look like. This is fact-based but has a point of view that you have to keep in mind.
The paper itself is concerned with the risk of inflation, but in dealing with that it provides a walk-through of why we are in our present situation and what has to be done to remedy it. It is not particularly short, at 12 pages of small type, but it is worth the time. The author clearly has a point of view at odds with that of many economists, and he admits as much throughout the paper. Although I do not think the risks are as high at the moment as the author suggests, he does an excellent job of identifying the real issues we should be concerned about—as opposed to worrying about running out of socks. As with any documentary, you want to take the opinions with a grain of salt—but you will learn something from the facts.
Worth a look.