People who grew up during the Great Depression were forever scarred by the experience and it affected their financial behavior, or so they say. Members of my family who experienced that calamity were horrible with money, the antithesis of the risk-averse, hyper-saving Depression archetype. On the other hand, research does show a substantial cohort was influenced by the event. For example, a Stanford paper indicates it had a “substantial” effect. After the crash of 1929, it was decades before many average investors trusted the stock market again. This time, the market came back quicker and returns on fixed income investments have been horrible. No wonder a Vanguard study showed 401(k) participation returned to pre-recession levels by 2010.
How has your behavior changed — or not. You can make multiple answers. If I left something out or you want to explain further, please use the comments field.
Read on for some of the best stories of the week you might have missed and the haiku.
This Week’s Links:
• The age of fraud | Ritholtz
• How the NSA’s just like Wall Street | Salon
• Financialization as a cause of economic malaise | Bruce Bartlett/NYT Economix
• Report highlights STEM workers who often go ignored | Washington Post
• Massive real wage cuts will not improve growth prospects | Billy Blog
• Intergenerational occupational mobility since 1850 | Owen Zidar
• Should Japan default on its sovereign debt? | Noahpinion
• Wal-Mart accepted clothing from banned Bangladesh factories | ProPublica
Today’s Econ Haiku:
It’s a turning point
But the signs are all confused
They’re all marked ‘exit’