Written after the September 15, 2008 stock market crash.
The current stock market plunge has more in common with its name sake
"Black Monday," two decades earlier, than the news has explained.
The original Black Monday was October 19th 1987. It was the day that the
United Nations convened a discussion about "Our Common Future" the report
of its World Commission on Environment and Development. The report had
been tabled, and the date for the discussion set, six months earlier, so
the October 19 date was no surprise.
"Our Common Future" authoritatively documented how the human family was in
danger of overwhelming the Earth and would foreclose many future options
if we continued to expand our exploitation of natural resources and
production of waste.
An initial sell off of heavy industry that day started a computer feedback
loop that triggered more selling and quickly amplified into the biggest
single-day loss since 1929. Moving away from industries that are
threatening our long-term well- being seemed a prudent move on a day
during which the nations of the world were to discuss curbing the dangers
caused by such firms.
While the initial response to "Our Common Future" was a surge of remedial
action, that response changed as recession emerged in 1990. The need for
sustainable investment opportunities trumped environmental concern and
globalization, in its present form, took over.
Nearly 21 years later we have another Black Monday. The connections go far
deeper than the stunning drops in stock values. In an effort to maintain
the perpetually expanding money supply needed for our present economic
system, ways and means were pioneered to make money on money, rather than
from material production. The result, after many years of apparent
success, is the present crisis. Money has no enduring value unless it is
tied to things that people are willing and able to produce and work for.
Since 1987, humanity has burned more than 400 billion barrels of oil.
(Comparable to Saudi Arabian reserves and Canada's Tar Sands combined.)
Because this drain has made it harder to meet demand, the price went up,
stimulating inflation and interest rate increases to stem that inflation.
The higher interest revealed that many sup-prime mortgage holders didn't
actually have the wealth to back up the money created for their mortgages.
There is a message here if we choose to hear it. We are stretching
petroleum supplies, and the environment's ability to absorb our waste. We
have also grown past the ability of creative accounting to back up an
exponentially expanding money supply.
All these issues point to a human family that has grown to fill its
planet. We must now give up our childish growth, take responsibility for
our strength and start living on Earth as if we want to stay.
For a very timely deep analysis of how the economy must be restructured to
remain within planetary limits, read Life, Money & Illusion: Living on
Earth as if We Want to Stay.