Hard Times

For millions of people this week has already seen its share of devastating events.

There have been so many events it is hard to remember them.  But it was just this past Monday that Lehman Brothers filed for Chapter 11 Bankruptcy protection.  It is the largest bankruptcy ever.  The company reported $613 Billion in debt and $639 Billion in total assets.  This dwarfs the previous record set by WorldCom in 2002 which had only $104 Billion in debt.  

When I read the first article about Lehman I thought to myself "wait, there seems to be more assets than liabilities by some $26 Billion."  But I gather there may be a lot more bond debt and that a good hunk of the assets is worthless sub-prime mortgage stuff.

Then Bank of America bought Merrill Lynch.

Then AIG, an insurance company with more than $1 trillion in assets, was bailed out by the feds.  Bail out is actually an interesting term here.  The arrangement allows the company to continue but wiped out nearly all of the equity.   There were a lot of folks who owned AIG stock just as there were a lot of people who owned Lehman stock.  

As it turned out I was meeting with someone on Wednesday.  He told us about a relative that had retired from AIG and whose retirement account was 100% invested in AIG stock.  That same story with variances in amounts has occurred now thousands and perhaps millions of times.  There was no bail out for those individuals.   The bail out does save some jobs of current employees.  But mostly it helps save the customers.  

These events were troubling for the stock market and it dropped a bunch.  That drop of course further hurt countless numbers of investors both big and small.

It reminded me of the times I've personally experienced economic hard times.  There have been at least four times.  The hardest for me eventually resulted in personal bankruptcy.  Let no one kid you about bankruptcy being trivial and easy because mine was not. 

My parents both lived through the Great Depression.  It usually is considered to have lasted 10 years.  That duration alone sets it apart for sure.

The headlines kind of gloss over the personal tragedies that are occurring just beneath them.   Somehow the headlines make it seem as though it is just about numbers and shares and percentages.  It is easy to forget that there are real, flesh-and-blood people who are losing what it has taken many a lifetime of hard work to gain.

It will turn out that this current situtation has been caused by a lot of illegal activity.  For some reason that fact will be diminished and there will be a cry for more rules.  Those will be enacted.  But sometime in the future my children and my grandchildren will all experience their own hard times.  Because a lot of people are really good at stretching or downright breaking the rules.

None of the economic hard times match the other kinds that deal with death and divorce and pain and hurt and war and famine and drought and pestilence and disease.

But I was thinking about what I've learned about hard times.

One important thing is that they do not last forever.  And maybe next is that one can and does survive.  Then I've learned that there can still be joy.  Maybe that is because it comes from way inside and that's where we are forced to turn when there is no other place.