Although there were many factors that contributed to the severity of the Great Depression (huge stock losses, bank runs, worldwide trade isolationism, the lack of FDIC guarantees), a severe and consistent drop in consumer spending was one of the major factors.
Although we like to pretend that economics is a hard science, it isn’t. There is no Bernoulli’s principle keeping the wings of our economy aloft. It’s not a 747, it’s Tinkerbell. It only flies if we believe it will.
Which is why Obama’s win, and his campaign based on ‘hope’ may provide some genuine economic benefits. But only if we believe…
UPDATE: Or, maybe not. Come on people, clap!