We have been told by mainstream media for a while now that we are experiencing a recession. It seems as if “that’s our story and we’re sticking to it”, but back when the media was struggling to define its label the question was asked: “Is this a recession or a depression?” and quite a bit of babble was devoted to this for a while, because we have this need to label our experiences and if we can do that we see that as a sign of progress.

Why have the behaviorists on Capital Hill propagandized this “recession” notion so hard?

Well, we’ve had recessions before, they come and they go in cycles, we always come out of them and we’ll come out of this one too. In fact, the latest spin on conservative mainstream main street is that this recession looks like it could be turning the corner before year’s end … so everything’s going to be o.k., and just like it was before.

The problem with this spin is that anyone sharp enough to have any real disposable income left probably isn’t buying it.

In point of fact, this isn’t a recession at all, and it isn’t a Depression either. Frankly it is something altogether different. Yes, while we did have a corrupt financial cartel of industrialists and bankers defrauding the public, collusion, asset bubbles, inflated claims, unemployment and many other similar problems in the Great Depression as in today’s economic crisis, there are huge disparities between what is going on today vs. then, as well as with any of our prior so-called recessions.

d-borgFirst and foremeost, we never had derivatives before this crisis, and as I have said many times before, derivatives are at the core of today’s breakdown. They have allowed the exponential growth of inflated claims to reach epic proportions. Without derivatives we could not have leveraged ficticious monetized claims to the tune of 15 times the entire gross domestic product of the world, which is not just a first, but a massive first for the planet Earth – something completely alien. And this is the crux of the situation at hand.

Secondly, we are not responding to this crisis in the way that we did during the Great Depression. We are in fact embracing it’s very nature as the cure, hoping that continued leveraging will somehow guide us back to the straight and narrow path. We have done this in part because people who have studied the Great Depression think that our reaction to it was too austere and protracted, and there is softer, less painful approach.

We also have this new way of thinking that perception dictates reality and therefore if you can manage perceptions (the behaviorist approach) you can control reality. But the fact of the matter is, reality will eventually manage perception, and when it does perception will feed and reinforce that reality.

These dramatic precedents have created a situation which cannot yet be defined in the context of past events. In Japan we called the 90′s “the lost decade”. Perhaps we’ll call this “the lost generation” but it is too early to predict what history will label this current physical economic breakdown.

It will certainly not be seen as anything we have labeled in the past.

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