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>But you must realize that during such a war, the maximum economy possible in the US would be whatever can work without international trade, which would be comp

by tsotha 11y ago

>But you must realize that during such a war, the maximum economy possible in the US would be whatever can work without international trade, which would be comparable to 1900 or so. So every country except the US is involved in this hypothetical war? Really? If China attacks Japan, even assuming that drags in Vietnam, the Philippines, Korea, and Indonesia that still leaves a whole lot of countries for us to trade with. The idea the S&P would drop by 99% is just daft. Beyond that it's not like we can't get involved in a war once it starts if we decide it's in our interest to do so. War isn't like a comedy club where they shut the door once the act starts.

iofj 11y ago
> So every country except the US is involved in this hypothetical war? Really? Happened twice in the last century. Even South America was the least affected, but it wasn't unaffected, and it's not like they'd generate a huge amount of trade (compared to EU/Asia who would definitely be involved). > If China attacks Japan, even assuming that drags in Vietnam, the Philippines, Korea, and Indonesia that still leaves a whole lot of countries for us to trade with. The idea the S&P would drop by 99% is just daft. Out of the 10 worst stock market crashes, 8 happened during WW2, 7 during the period where the US wasn't actively involved in the war. Depending on the date range you pick you could say it dropped 50% in absolute value, or you could say it stayed about constant. This was during a period with >10% average inflation ratio, so that's pretty fucking bad. "Real value" of the S&P500 (meaning "how many big macs you could buy" for index shares 1935 to 1950) dropped ~74%. And that's still ignoring the fact that many products simply became unavailable, because there was no way to safely acquire them from US soil, at which point price becomes a moot point. This agrees with anecdotal evidence I heard from my grandfather : the beginning of WW2 (I think he means 1938-1939 onwards, when you could still delude yourself there was peace), there was no violence, there was simply a hell of a lot of people going unemployed very fast, shortages of all sorts of stuff, and a lot of rich people suddenly looking for jobs. > Beyond that it's not like we can't get involved in a war once it starts if we decide it's in our interest to do so. War isn't like a comedy club where they shut the door once the act starts. True, but at that point the consequences are a "fait accompli", history, and unchangeable. You don't ever want to get to that point if you can avoid it at all.
- tsotha 11y ago
  >Happened twice in the last century. Even South America was the least affected, but it wasn't unaffected, and it's not like they'd generate a huge amount of trade (compared to EU/Asia who would definitely be involved). Well, okay. But we traded with (and made a hell of a lot of money from, frankly) the combatants until we entered the war. >Out of the 10 worst stock market crashes, 8 happened during WW2, 7 during the period where the US wasn't actively involved in the war. Temporary crashes in the stock market are just noise. Long term investors won't even notice. If a few traders go bust? Meh. >True, but at that point the consequences are a "fait accompli", history, and unchangeable. You don't ever want to get to that point if you can avoid it at all. We've done it before. Twice.

by tsotha 11y ago

iofj 11y ago

> So every country except the US is involved in this hypothetical war? Really? Happened twice in the last century. Even South America was the least affected, but it wasn't unaffected, and it's not like they'd generate a huge amount of trade (compared to EU/Asia who would definitely be involved). > If China attacks Japan, even assuming that drags in Vietnam, the Philippines, Korea, and Indonesia that still leaves a whole lot of countries for us to trade with. The idea the S&P would drop by 99% is just daft. Out of the 10 worst stock market crashes, 8 happened during WW2, 7 during the period where the US wasn't actively involved in the war. Depending on the date range you pick you could say it dropped 50% in absolute value, or you could say it stayed about constant. This was during a period with >10% average inflation ratio, so that's pretty fucking bad. "Real value" of the S&P500 (meaning "how many big macs you could buy" for index shares 1935 to 1950) dropped ~74%. And that's still ignoring the fact that many products simply became unavailable, because there was no way to safely acquire them from US soil, at which point price becomes a moot point. This agrees with anecdotal evidence I heard from my grandfather : the beginning of WW2 (I think he means 1938-1939 onwards, when you could still delude yourself there was peace), there was no violence, there was simply a hell of a lot of people going unemployed very fast, shortages of all sorts of stuff, and a lot of rich people suddenly looking for jobs. > Beyond that it's not like we can't get involved in a war once it starts if we decide it's in our interest to do so. War isn't like a comedy club where they shut the door once the act starts. True, but at that point the consequences are a "fait accompli", history, and unchangeable. You don't ever want to get to that point if you can avoid it at all.

tsotha 11y ago
>Happened twice in the last century. Even South America was the least affected, but it wasn't unaffected, and it's not like they'd generate a huge amount of trade (compared to EU/Asia who would definitely be involved). Well, okay. But we traded with (and made a hell of a lot of money from, frankly) the combatants until we entered the war. >Out of the 10 worst stock market crashes, 8 happened during WW2, 7 during the period where the US wasn't actively involved in the war. Temporary crashes in the stock market are just noise. Long term investors won't even notice. If a few traders go bust? Meh. >True, but at that point the consequences are a "fait accompli", history, and unchangeable. You don't ever want to get to that point if you can avoid it at all. We've done it before. Twice.