Spurred by yesterday’s events at the New York Stock Exchange (earlier today for us night owls), I want to take critical notice of Thom Hartmann’s The Crash of 2016, which I coincidentally finished the day prior. The book is incredibly well researched, and offers some new historical insights into the already well-documented history of the most recent seizure of power by the wealthy oligarchs. After offering a pretty expansive survey of this history, Hartmann argues that we are teetering on the edge of the next great economic crash, as they occur about every eighty years, and while the bank bailouts bought us some time, the recession wasn’t the end of our troubles. His conclusion is that a full crash just is inevitable, and any number of shocks will push us over the edge when the derivatives market implodes, giving possible causes as a panic from Greek banks becoming insolvent, a sudden increase in oil prices, or the burst of the housing bubble in China.
Hartmann was wrong about the housing bubble being an immediate shock, but he’d likely argue that we’re not out of the woods yet, with the current falling value of stock in the Chinese market being a market correction after investments were moved from property to stocks being eerily similar to investors divesting from property after a Florida housing bubble burst and caused a stock bubble, that when burst, caused the Great Depression. So Hartmann might not be wrong after all.
My point of contention with Hartmann arises from the fact that he offers no proposals for how to avoid a crash — his suggestions are all in regards to what sorts of policy we should enact after the crash. Given that his main argument is that a crash is inevitable and could happen at any moment, I can’t really hold him to the point that he should offer ideas for how to prevent what he thinks is inevitable.
What he did fail to address was that with our political system so warped by wealth inequality, and seeing a great crash as an opportunity to build anew a social democracy, per the New Deal, radicals might be inclined not to wait and suffer under the oligarchs any longer, and tank the economy by causing a shock, perhaps one as minute as hacking the New York Stock Exchange and causing them to be unable to trade for three hours, as was the case yesterday. The day before the technical difficulties, the activist hacker group Anonymous tweeted rather cryptically that they wish Wall Street luck but that they didn’t need it. To be clear, it seems the difficulties didn’t cause any real harm as other trading exchanges, most importantly NASDAQ, remained open, and so overall trading was hardly interrupted. If it were a move by Anonymous the technical difficulties would likely be more wide spread in order to have effect, and so it seems unlikely that hackers were involved.
The point is that the shock to do in the economy could be a digital strike by hackers, and if it is, we won’t know whether it’s because of anarchistic whims or a radical desire to force an economic vacuum sufficient for a revolution.