oh, also - do you have a personal plan for coping? Even if you'll be all right with employment, there will certainly be changes around all of us. Are you planning to plant a garden? Work on your spiritual practice? Enhance other areas of your life - friends, social groups? Go back to school? Learn a new skill? Start a business of your own? Cook differently?

I have no idea, but I'm really, really scared about keeping my job. I work in a very wee department that is located off campus and most people tend to think that there's no real people out here, just robots. Plus, I'm planning on hopefully moving out and starting school for real in the fall.
I'm just freaked out completely.

do you have a personal plan for coping?

Luckily for me my father is alive and lives in a mortgage free house with a basement apartment, so there is always a safety fallback position.

As many of you know, I've been frustrated with management at work for some time. The actual casework I enjoy very much, but the way the place is run is ridiculous.

Anyway, I've decided to stay put for the foreseeable future. Whilst I know that I'd definitely be paid more in private practice, I also know that the job market is uncertain and unpredictable, and I'd be an idiot to give up a very secure job.

And, unlike many people, my job is secure in the present climate, because I'm dealing with the fallout of the current financial crisis. We are overwhelmed with work and are recruiting another 300 people. (You may recall, a year ago 300 staff were laid off, which was, we all knew, a 'cull' of what they saw as dead wood, not a genuine redundancy situation, then they hired another 500 immediately after, and now they need more.)

In terms of personal finance, I'm not over-exposed by any means, so I know I'm in a much more fortunate position than many others.

I can see more big chains closing, especially phone shops, maybe a few of the big sportswear retailers (there's often three or four competing stores within yards of one another), maybe Dixons, and, I think, Monsoon/Accessorize might struggle. Just a gut feeling.

I feel sorry for small businesses - the 'niche' ones might be too specialised to survive, and the more mainstream ones will find it difficult to compete with big or online sellers.

The area where I live - well, no houses are selling. It's not really a first-time buyer area, apart from a few new blocks of flats that went up over the last four or five years. New-build flats are being rented out. A lot of them are empty - it's a tenant's market.

I predict most of the designer and luxury shops in our little high street will close. A couple have already gone. A new and expensive restaurant opened just before Christmas. It looks lovely but is always empty. People just don't have £100 to spend on a meal out any more.

I hope this is the start of an era where people learn to be satisfied with less, to have a simpler life, and realise that money is not the be-all-and-end-all. I know that, for me, my life improved massively when I made that shift a few years ago.

I don't think we're going to have a 21st century depression because our economy and workers are too efficient. As a country we are productive and unless the government raises taxes (which is usually the cause of a depression: raised taxes and a recession) we won't have a depression.

Obama's spending plan is not going to fix the economy because there is no plan big enough. Our economy is a sink hole, you can't fix it with enough projects or money. You can't sustain it at the same rate it's sinking, it must sustain itself, and it will. The plan will give the perception that we're doing the right thing and that we're on top of it, which is what is needed. What is needed at this time is consumer confidence. It will rebound naturally.

Dem and Republicans agree that not raising taxes and spending more money is the way to avoid a depression. So, while I'm not an expert in the least either, I'm not afraid of a depression. Maybe I'm naive, but I'm not worried. I am financially stable at the moment and unless my husband's business starts to seriously decline, I'll start panicking. At the moment I am employed and if I am laid off and they stop hiring nurses, I'll panic some more.

My personal plan for coping is not to worry too much and keep spending, baby! ;-)

I'm going to work on increasing my cash reserves- was going to do that anyway for various reasons, but now it makes even more sense. I think my job is secure, for now, but you never konw.

usually the cause of a depression: raised taxes and a recession)

Not sure it's that simple - though it's not used precisely all the time, there are definitions for depression and recession. The wikipedia says succintly:

Considered a rare but extreme form of recession, a depression is characterized by abnormal increases in unemployment, restriction of credit, shrinking output and investment, numerous bankruptcies, reduced amounts of trade and commerce, as well as highly volatile relative currency value fluctuations, mostly devaluations. Price deflation or hyperinflation are also common elements of a depression.

We are already in recession and had been for all of 2008, so that's one cause of depression that's in place. This gives a list of the five major causes of the Great Depression: Stock market crash, bank failures, reduced spending, trade deficit, and natual disaster (dustbowl). Raising taxes wasn't really a culprit. Reduced spending was, and that's one that we are certainly seeing already, big time - and of course you could argue that raising taxes means less spending, but that's not actually true it means reduced consumer spending, but more government spending, so I think overall spending comes out even, the question is where it's being spent and how that affects suppliers and jobs. Not that I think we should raise taxes; everyone seems in agreement that deficit spending by the government is a better choice, but man that hurts when we've already hocked our grandchildren for the bailout. Hopefully we will recoup some of that in the long run.

Anyway, I don't think it's too farfetched to say we could be entering a depression. I'm not saying it's going to look like the Great Depression, because the world is very different and we have a much more effective social safety net than we did then and people, overall, are just not as poor and not in as poor physical shape as they were in the 30s. So I'm wondering what it looks like when it happens now. Like today of course, only what else?

There are many repercussions not yet felt. For instance, we have not put our FY2010 budget into place - doesn't start until April, so our cuts won't go into effect and be felt until then. On April 1 we will be paying fewer wages and benefits and doing less spending on construction and supplies, so spending from our budget will disappear. Many institutions are in the same boat. Plus, we heard this morning that there is some possibility that our line of credit will not be renewed when we reapply for FY10- true for many nonprofits. That is close to a death blow. I am also hearing that home refis are basically not available. So I think the bank issue and preventing further stock failure is definitely as important as anything we do with spending, though of course it's all part of a cycle.

I hope this is the start of an era where people learn to be satisfied with less, to have a simpler life, and realise that money is not the be-all-and-end-all.

Me too.

I think the best answer to this question is always not what "things out there" will look like, but what we as individuals do for ourselves and our communities.

I know this sounds so very hackneyed already, but the President is on to something with all of the "be the change" rhetoric.

We got into this morass from not looking at ourselves and others from an honest, direct place and we won't get back to normalcy without that. What is needed now is some serious humility and egolessness across the board.

The Me-First, trickle-down economy didn't cut it.
The You-First economy reeks of socialism and no one will ever try it.
But the I Did This First, And It Was Good - Now I Will Teach You economy is what is sorely needed now.

My personal plan for coping post-layoff is to take good care of myself, look for ways to volunteer around this area, and keep the focus on what I can control, change and create for the better.

Humility and strong interconnectedness is the key. Find your mentors and grant them time to strengthen you to become a mentor yourself.

Lather, rinse, repeat.

I am on a fixed income and have no future to save for. My son's financial future is as solid as I can make it. Other than holding a couple hundred bucks back to prevent bouncing checks, I will be spending my money like there's no tomorrow. Hopefully my actions will somehow save at least one person's job.

I can't see it being a return to the 1930s: things are too different now. That was before modern welfare, before bank deposit insurance.

Also we know more about how to handle recessions now. A lot of the early Depression-era policies made the recession worse: they cut spending instead of raising it, the value of the currency was increased.

Even so, recessions are nasty... I think people have forgotten what a "normal" recession is like.

But the pain is not evenly distributed. If you're retired, or a student, or you keep your job, then you won't be badly affected.

If you lose your job, it will take much longer and much more effort to find a new one.

If you're self-employed, you'll probably find your income shrinking, and if your business was only borderline profitable, you'll find yourself in trouble.

What annoys me is when I see articles saying things like "now we will pay the price for our years of greed". Actually most of the pain is going to fall on just a fraction of us, and they're mostly not going to be the greedy people who thrived in the boom, but people who struggled even in the boom and are now going to be tipped into outright poverty.

It sucked to lose such a portion of my retirement savings. I've always been frugal, so there's not much in my budget to cut. I'm being really cautious, as my job is only somewhat secure. If the US government would fix the health insurance mess, I wouldn't be so terrified of a layoff. All that said, I'm doing fine, and delighted that the Bush years have ended. I did start a graduate course, but it will take years to get a degree.

Well, we live like this (not quite so extreme, but it feels like it) because it has allowed us to more or less maintain. My job is killing me in the head, but I guess I'll just keep the palliative care going on that, since I believe the "if you keep your job, you won't feel too much pain" and the "it will take longer and more effort to find employment" analysis TheophileEscargot mentions and that I see expressed so many places.

It does seem that the middle will bear the brunt of it. I know precious little about the Great Depression, but didn't it have serious consequences across classes? It seems this time around that the poor continue to struggle, but haven't lost as much as the middle, and that the top mostly have to worry about recession-chic crap. Of course, that could just be media spin; I don't really know.

I'm deeply concerned, personally, about having no margin for error. What if I do lose my job? What if the self-employed Mr. B can't find health insurance? What if either of us is in an accident? Or our parents get sick? Or what if my sister's house burns down? Or any of the million things that can go wrong? I've never felt so incapable of recovering from the unexpected.

I've never felt so incapable of recovering from the unexpected.

Well put.

As far as the wealthy during the Depression - I don't think it was significantly different from today. A lot of people who had everything in stocks lost a lot, maybe enough to affect their overall class status. But people with plenty of cash, a cash-generating business, good productive land, or money in gold did fine. In fact some did relatively well because the cost of living was dropping and prices were dropping, so the expenses of doing business and simply living were less. Labor was really cheap and totally abundant, so owners of major businesses were sitting pretty there. Here's a super simple page on class tensions and wealth flaunting from a depression website at the UVA Crossroads site, where there is a lot of neat stuff.

I'm old enough to remember the billboards around Seattle (one not far from my house) that read, "Will the last person to leave Seattle please turn off the lights?"

That was the early 70's and things were so bad the billboard company didn't have any advertising to displace those signs for years.

People who have come of age in the 80's and 90's have no idea what tough times are. Not really. Sure there have been a couple of hiccups along the way but the economy has mostly been running flat out for a good couple of decades.

Downturns are necessary in a free(ish) economy. Market-driven economies are Darwinian. It is survival of the fittest out there and downturns weed out the weaklings in the herd. Companies that survive weed out the weaklings within the organization as well.

Government can't prevent recessions -- nor should it -- but they sure can make things worse and longer. Hey, its what government does.

One thing we have more of than ever is a massive small business layer but they will be the first to pull the plug due to over-regulation and increased taxation. When that happens, watch out. Small business is the real foundation of our economy but state and federal elected officials love to stick it to them, for some reason, as if they'll just endure whatever is heaped upon them.

Personally, I'm in good shape but whatever happens, happens. I can't predict the future so I don't fret about it. Worst case is Chapter 13 and that's survivable. If the bottom falls out nobody will care anyway.

We've been in a Ponzi economy for awhile. Short-term thinking has led us to use the proceeds from the next guy's investment. Now there's this idea that the poor and soon-to-be-poor should flock to spend, keep the economy afloat. But I think we'll find in the coming months that the banks, now changed into corporations, are caught in a trap of self-interest and don't remember what sound practices were. I think regulators have the toughest and most important job there is right now, but I think they won't even know where to start. Fuck if I can find the work I'm educated for. Of course, I'm educated to live in another country, which I'd rather not do right now(suck it up and ditch, Hugh). But you know, scads of people have been educated out of the production class. I'm jumping early into the day labor career so I can have some skills and contacts when the contractions occur. It's gonna be a mess, credit default swaps are only the beginning; I know from having worked in a regulatory group at Citi that there's been so much hiding of dangerous financial vehicles that now every barrel has a rotten apple. And here we are bailing them out, reanimating this great gutted corpse of a bank. Greed was good in the eighties and nineties and it's been paid forward for as long as it could have been. Short-term thinking. Too bad we have to be alive for the inevitable comeuppance. This has little to do with the atrophied but honorable Working American, though most of the piping you hear about bootstraps and shit just ain't true anymore; multiplication led to division. Living on golden wishes got us fucking creamed. Better start liking peanut butter sandwiches and canned beans.

The historical analogy that comes to mind when I think of the current crisis is not 1930s America.

It's 1990s Japan. A long, drawn-out period of virtually no economic growth at all.

Me, I'm on the edge of the labor market, relying on unemployment insurance and occasional part-time temp work to pay the bills. I'm the better part of forty years old. I have almost no permanent experience. Employers don't get any diversity points for hiring me. So I think my prospects for a traditional "career" with benefits and job security, are not good in the least. That's not depression talking, or my own innate pessimism; those are just the fucked-up facts of life.

I'm happy to have rid myself of those illusions as a single man with no children, no mortgage, no significant amounts of credit card debt.