The current economic crisis, compounded and multiplied by the speed at which the world devours information, whether sound or rumor, has created something like a symbolic economy (made of finance, stocks, money, bonds) that is independent from the real economy and move at a completely different speed.
This symbolic economy is being massacred by the symbolic equivalent of World War Three: from a local conflict (some midsize banks in the US) it spread to secondary geographical entities (Portugal, Ireland, Greece) and is now at the gate of Europe, threatening economies “too big to fail” and the very existence of the Euro. Already the talk at the G20 meeting in Cannes reminds me of the Allies vs. the Axis propaganda and the finger-pointing game on a grand scale is fully underway; this war will sound to us as alien as an intelligent bomb dropped from a stealth B2 bomber would sound to a Roman legionary.
No, there won’t be ICBMs thrown at big metropolitan areas: why bother? The same final effect (the development of a new world order) can be obtained by a skillful play on futures. And most people will think nothing of it because we will be spared the millions of casualties.
If we are living in a war economy we must therefore think of what are the best strategies to survive it: for example (just like in a war economy) I wouldn’t want to be sitting on large piles of cash (not that I ever had the choice…) as it’s easy to see how it would be a primary target for “bombing”. Maybe one of the effects will be a massive restatement of asset values, maybe a house now worth a million will only be worth a hundred grand which to an extent is happening already: the major italian banks are now worth half of what they were 12 months ago and every day european stock exchanges move up or down 5% if not more.
This may not be as devastating to the real underlying economy: if the house I have is worth 1/10 of what it was, so will be the house I will buy next, no big deal. The symbolic rubble may not be in hollowed-out churches or flattened factories, but in a new governance system that may or may not contemplate a sophisticate finance lever and the even more sophisticated industry that goes with it.
Unfortunately, the world has never seen a symbolic war before, so we don’t really know how it will play out. Moreover, we don’t even know who the enemy is, and in most cases it is a mix of “them” and “us”, with some of the damage self-inflicted and some received from outside, so frankly I see no reason for tranquility.