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The Unprecedented Crash in The Real Economy: Recession or Depression?

DK Matai - October 26, 2008

Dear Friends, one of the most jaw-dropping bulletins ATCA received this week was the announcement by Volvo, the world's second largest truckmaker. In the third quarter, Volvo received just 115 net order bookings for new trucks in Europe, down from 41,970 a year earlier, ie, a degradation of 99.7%.

In Europe Volvo had almost as many cancellations as new orders. Orders at Volvo crashed 55% in the third quarter year-on-year. The company said that the slowdown appeared to be spreading to emerging markets and its orders in North America had failed to recover.

Why? Volvo's customers are apparently holding back on replacing vehicles because of the economic uncertainty, and some are not receiving credit to finance new trucks because of tighter credit market conditions. Scania -- majority-owned by Volkswagen -- which is not present in the depressed US market, has also received 41% fewer orders than in the same period last year, with a 69% decline in western Europe. Both Volvo and Scania have declined to give an outlook for next year given the financial uncertainty. Both truckmakers have been cutting production by cancelling shifts and laying off temporary workers.

Volvo also announced last month that it was cutting 1,400 truck production jobs in Belgium and Sweden. It then made 850 workers redundant this week in its construction equipment division in Sweden, adding to 500 already announced job cuts there. Volvo has now said that it is considering further redundancies. Fiat and Daimler are both forecasting massive cuts in this year's earnings and Fiat warned of a worstcase scenario that could see sales dropping up to 20% next year. JCB, the UK construction vehicle firm, said its workers had agreed salary cuts to protect jobs, while in France, Peugeot Citroën has slashed production, warning sales will fall by as much as 17% in Europe. Renault has also issued profit warnings and Nissan said it would cut production and move to a three-day week in the run-up to Christmas. Renault said it is cutting production by 20% in the fourth quarter. Chrysler, whose owner has been in talks to sell the automaker to General Motors, said that it will cut 25% of its salaried work force starting next month and warned that it will make more restructuring announcements soon. Chrysler’s sales are down 25% through the first nine months of the year, the worst decline of any major automaker. Some manufacturing data cannot be ignored because it heralds the unprecedented slow down in the momentum in the real economy, which is another way of saying "crash" with the consequence of rising unemployment and social unrest.

Earlier this year I was involved in a motorway pile-up caused by a car in front in the fast lane in which a fight broke out between a couple. The consequences hit us all -- no matter how safely we were driving. The infuriating thing about what happened is that those who behaved most cautiously in some ways suffered the most.

Are we heading towards the sharpest downturn humanity has ever seen in the real economy? “This is a once-in-a-lifetime crisis, and possibly the largest financial crisis of its kind in human history,” according to the Bank of England Deputy Governor Charlie Bean. Those words suggest a depression and not a normal recession. US President Harry Truman commented more than 50 years ago, “It is a recession when your neighbour loses his job; it’s a depression when you lose yours.”

[ENDS]

We welcome your thoughts, observations and views. Thank you.

With love and warm wishes to you and family


DK with family

DK Matai

The Philanthropia, mi2g.net

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Posted by DK Matai at October 26, 2008 12:32 AM

Comments

I'd say this amounts to a total eclipse of the Sun to those who thought the Sun was God. The Moon is Goddess for the while? Trust.

Thank God it is not yet cessation lol.

[Earlier this year I was involved in a motorway pile-up...The infuriating thing about what happened is that those who behaved most cautiously in some ways suffered the most.]

There are the ways of Man and then there are the ways of God or basic-forces-driven Scheme of Things which will override them. Not for nothing Krishana said to Arjuna: "Arjuna do what you have to do (be cautious in this case)but dont think that what will happen will happen according to what you do. That will be according to what I DO (which for me will as AS PER THE basic-forces-driven SCHEME OF THINGS).

While doing our best the best philosophy now-a-days will be to surrender or be a Stoic. Thanks to every global cultural cycle going through the like periods because of the forces, the Stoic philosophy came into vogue in the last phase of Greek Culture of BC era as well and because of the same reasons.

Dear DK,

The old must make place for the new to emerge.

My mother died yesterday morning at the age of 88.

Born in 1920 she lived through it all: the great depression, WWII and was a member of the so-called ‘building up’ generation after the war.

This generation did a tremendous job in Europe.

Her last words before she died were: ‘goed gehad’, translated this means: ‘had a good life’.

This is what she and her generation created for us: a good life.

Situation today is already so much different from the 1930’s.

What we now experience in every aspect globally looks indeed very much alike, but new ideas, projects, inventions arise every day whilst at the same time it is so difficult to say goodbye to the old.

Let us not talk each other into a depression, but let go of the old and embrace the new.

There is every reason now for all nations to stick together, work together and, above all: give our young people all over the world a CHANCE, let their ideas come forward and lead the way.

Something that is already happening by itself…

Hi Harb,

Yes be a Stoic seems to be the best way to surrender to that what is :)

With gratitude for what life has given me up till now.

Mieke

Trusty St Oic am I ;)


Great respects to Mother, Meike, and a hug.

Dear beloved Mieke

Very very sorry to hear about your mother's passing away.

I feel how weak and fruitless must be any words of mine which should attempt to beguile you from the grief of a loss so overwhelming. But I cannot refrain from tendering to you the consolation that may be found in the empathy of your friend.

We pray that our heavenly Father may assuage the anguish of your bereavement, and leave you only the cherished memory of your beloved mother, and the solemn pride that must be yours for her to have laid so costly a sacrifice upon the altar of our joint freedom in Europe and in the free world during "the Great Depression, WWII and as a distinguished member of the so-called ‘building up’ generation after the war."

Yours very sincerely and respectfully,

With all our love

DK and family

Mieke, not all can die saying "had a good life." It is a sign of fulfillment. Your mother must be special. My last salute to the great soul. Such are the times when we are tested to walk the talk of our wisdom. I am sure you must be walking it successfully.

Hi Ed, the Great Gardener!

Harb

Dear Mieke,

please accept my heartfelt condolences on the passing of your Mom......what great words to hear from someone at the end of their time.....

Hello DK and Everyone,

actually, we do not know what we are headed for or how bad it could be or even how long it will last..this is a brand new...booboo.. for our global system.....we know a bit more than we did a few weeks ago....and that being that the the 700 million band-aid was probably not going to cover the wound....it is deeper and wider than first realized....we need a lot more info...

we shall see....ruth


Dear Ed, DK, Harb and Ruth,

Thank you so much for your condolences and kind words, much appreciated and comforting :)

One thing is sure now: not a child anymore.

A wonderful song has been made about this by one of our Dutch singers/performers: Karin Bloemen. I just listened to it on youtube a few minutes ago. Wonderfully comforting song.


My mother was also a fan of the Beatles, she could enjoy their songs together with us, but also when she was alone she often listened to them.

One of her favourites: 'All you need is love'

Thanks for all the love you all have given me here on IB :)

Mieke

My heartfelt condolences, Mieke, and a hug. You and your mother- two very special ladies, making the world a better place... Thank you for your post #3, a healthy, constructive view.

Dear Mike,

Sorry to hear that, my heart felt condolences.
My regards and comfort.

Indra karan.

Thank you Aurora and Indra, so good to read your messages.

This is so heart warming. Am going to make something special of all your above words and put it in my mother's coffin as a last farewell.

Much love to you all,

Mieke

I am so sorry at hearing about the lose of your mother Mieke. Sending you blessings. Love, Char

Let the bubble pop!

Dear Mieke,
Your mother sounds like an amazing woman indeed; quite a pair of shoulders upon which you stand. Doubly precious - to have had a good life, and to be peaceful and conscious enough to be able to say it at the end.

And I love your "Let us not talk each other into a depression, but let go of the old and embrace the new.". Indeed; there may be a recession/depression as defined economically, but no need for one in our own minds.

I feel grateful for your presence, and for your mother's contributions in her long life.

dearest Mieke,
I join in celebrating the life of your Mom, and my blessings to you and to your family, as you remember and honor her.
with love,
~ Kate


from a lovely poem
by Hafiz.

~~~~~
~~~~~

Leave the familiar for a while.
Let your senses and bodies stretch out
Like a welcomed season
Onto the meadows and shores and hills.

Make a new water-mark on your excitement
And love.
Like a blooming night flower,
Bestow your vital fragrance of happiness
And giving
Upon our intimate assembly.

All the hemispheres in existence
Lie beside an equator
In your heart.

Greet Yourself
In your thousand other forms
As you mount the hidden tide and travel
Back home.


Dear Char, sWORDSman and Kate,

Am so grateful for all your kind words. Sitting with tears in my eyes.

Char, my blessings go out to you too. Take care, all the best to you.

sWORDSman, no need for recession or depression in our own minds; as long as we all can manage that, we are standing strong, together.

And Kate, yes we are celebrating at the moment, the children, grandchildren and great grandchildren. Many memories, laughter and tears and so grateful we are allowed to do this together.

Lovely poem!

Thank you all for sharing with me. Am making something special out of this as a memory forever.

Thanks also to Ron and North who both sent me a heartwarming message.

You are all very dear to me, much love from

Mieke

My dear Mieke,

Reading your mother's last words my head bowed in admiration. Someone who obviously valued and boldly embraced all that life had to offer. What a beautiful legacy she has left you.

God bless,
Love,
Dara

Mieke
Grand-mothers hold the secret of life in their hearts.

Blessings to you and your mother today.

derek

Hello dear Dara,

Good to read you here, how are you?

Thanks for your kind words. Well, all my life she was my example and she will stay my example. I inherited a lot of wise sayings from her in the course of years and i've often taken them literally. That always helped me through more difficult times in my own life :)

Blessings and love to you,

Mieke

And Derek, you are soo right :)

Lots of love to you!

Mieke

Net sales of underpants are also down.

But if you hang dry them, they won't wear out nearly as quickly.

(((Mieke)))

Hi, Meike. I had responded to the article without having first read responses.

I send love and condolences to you. May God shed his light on you during this time and always.

Thanks Dana, I could see the humour in your previous response :)

Mieke

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