The crash is even greater than it was then. It took years from 1929 until the full extent of the crisis became visible. Compared to today, it was like a slow-motion train wreck. Now the world economy has collapsed within weeks, and in the U.S. alone, more than 40 million people are unemployed. Many believe that the economy will pick up again just as quickly, but that is a fallacy.A "long hot summer" of unrest awaits America.
On Wall Street, big corporations set the tone, banks and technology companies in particular. They will survive the crisis because the state will never let them go under. They will kick people out, cut costs and in the end, they will have even more market power than before. But what we here call Main Street, small- and medium-sized companies, can't do that. They just go bankrupt. I estimate that every second restaurant in New York City will have to close, but McDonald's will survive. But that's not all.
In the area where I live, the Bowery in Lower Manhattan, three quarters of the demonstrators are white. Many of them are young and belong to the urban "Precariat," the new underclass that has replaced the traditional working class, the "Proletariat,” in advanced service economies. The Precariat is made up of temporary workers, freelancers, people who work on an hourly basis, gig workers, contractors - even though they often have university degrees. Those who are not in regular full-time employment no longer receive state transfers after three months. These people can then no longer pay their rent and telephone bills, and electricity and water are cut off. It will be a long, hot summer.Roubini adds his name to the list of those who believe that Trump will never leave the White House voluntarily no matter the outcome in November. America on the verge of a second civil war?
Trump does not go to the Supreme Court like Al Gore and request a recount of the votes if the election results are close in some districts. He will blame China, Russia, blacks or immigrants and act like the dictator of a banana republic. He will call his followers to arms – there are enough armed white fascists running around out there. He reminds them often enough of the Second Amendment, which allows Americans to own weapons.To close the interview, Roubini was asked if he saw signs of hope.
Hope? I'd have to think. It was good that the governments reacted so quickly and massively to the pandemic and its consequences. But otherwise? I fear that the 2020s will be marked by doom and disaster. Perhaps the global economy will be more sustainable afterwards. But for now, it will be gloomy.