economics 101

This isn't a phony crisis, it's very real, and no one should be taking delight in seeing financial institutions fail, simply assuming that a few greedy speculators and gamblers are merely getting their just desserts, or that the free market is merely correcting itself. When financial collapses and panics occur, they might start with hurting lenders but they never stop there. One relevant historical period to consider is the late 19th and early 20th centuries, the so-called "Gilded Age" when lack of regulation of the markets led to speculative bubbles that periodically burst leading to a series of depressions that destroyed the livelihoods of millions of people in America.

(cont.)

The Great Depression of the 1930s was called "great" for a reason. It followed a long series of depressions which afflicted the American economy throughout the 19th century. [...]

Panic of 1873

* The investment firm of Jay Cooke and Company went bankrupt in September 1873 as a result of rampant speculation in railroads. The stock market dropped sharply and caused numerous businesses to fail.

* The depression caused approximately three million Americans to lose their jobs.

* The collapse in food prices impacted America's farm economy, causing great poverty in rural America.

* The depression lasted for five years, until 1878

. * The Panic of 1873 led to a populist movement that saw the creation of the Greenback Party.

Panic of 1893

* The depression set off by the Panic of 1893 was the greatest depression America had known, and was only surpassed by the Great Depression of the 1930s.

* In early May 1893 the New York stock market dropped sharply, and in late June panic selling caused the stock market to crash.

* A severe credit crisis resulted, and more than 16,000 businesses had failed by the end of 1893. Included in the failed businesses were 156 railroads and nearly 500 banks.

* Unemployment spread until one in six American men lost their jobs.

* The depression inspired "Coxey's Army," a march on Washington of unemployed men. The protesters demanded that the government provide public works jobs. Their leader, Jacob Coxey, was imprisoned for 20 days.

* The depression caused by the Panic of 1893 lasted for about four years, ending in 1897.

Sound familiar?

he left off the panic in 1907 that bolstered the progressive reforms of the era---

The Panic of 1907, also known as the 1907 Bankers' Panic, was a financial crisis which occurred in the United States when the stock market fell close to 50% from its peak in the previous year. At the time the economy was in recession and there were numerous runs on banks and trust companies. The panic's primary cause was a retraction of loans by a number of banks in New York City, and the sentiment quickly spread across the nation leading to the closures of both state and local banks and businesses.

all of that is why the worship of "free markets" is so stupid----god help us all if we do not have governments and regulation of the market place----i think more and more people are understanding that these days