It’s funny to watch all this play out – sorry for my sang froid, partypup, but at least it’s not grim Germanic schadenfreude.
Chinese people learned to make dishwashers and DVD players and TVs and lots of other goodies for us, and tens of millions of them devoted their waking hours to getting us lots of the goodies at cheap prices. Price hardly mattered, though, because we were manufacturing new investment instruments and selling these back to the Chinese for lots of money. You can buy a lot of TVs for every $500 million bond issue you sell.
Now a huge US industry that grew up around making these financial instruments, and all the professionals servicing that industry, are being told that what they produce isn’t worth as much as they’d hoped. You do have to feel sorry for the minnows being dashed onto the rocks here, but the whole premise of many careers was shortsighted and crazy, and there is no sustaining it (short of social engineering that would starve the sectors of the economy that need to grow more, thereby making paupers of our children.)
Oh, and I work in the heart of the private financial services industry, with no bailouts on the horizon, and I just got a huge cut in compensation, and have had to prepare continegency plans identifying who gets cut, knowing I could be on another list, so I really do understand.
