It is no longer a case of the banks and the bankers, although popular media headlines will still have you believe that the crunch was purely of the banks’ making and somehow they should pay for it. It is now closer to home.
Not only has lending dried up, the housing market has ground to a halt. The fantastic drops in the stock market mean many have seen their life’s investments and wealth wiped out in a matter of days. Those close to their pensions are hit the hardest, as the bottom drops out of their equities-reliant pension pots, but not all understand the impact. Suffice it to say that it is not just us younger people who will pay for the bailouts all our lives, but it is also people approaching retirement, many of whom may have to continue working.
As a result of loss of wealth, people are spending less, even in the growing BRIC countries which were supposed to be able to absorb the shock. However the growth in these countries depended hugely on their customers in the West, ergo, crunch time. Jobs are not just being lost in the value-added services sectors but also those in retail and in other sectors. This hits consumer spending power even more as people sit tight on their money.
It is unlikely that our health will remain untouched by the upheaval.
Early research by the charity, MIND, suggests that debt and the spiralling cost of food and other essentials is affecting mental health of many adversely. It is not just the relatively poor, but also the formerly well-paid professional workers who are feeling the stress, and it is being termed the ‘Square Mile Syndrome’. Insomnia is reportedly on the rise too. However the evidence of the linkages between such macro-economic problems and suicide rates is mixed. A longitudinal study of Australian data suggested that there are gender and age related differences. It was seen that male suicide rates increased with markers of economic adversity, while the opposite pattern was seen in females. Age-stratified data showed that higher housing loan interest rates having a positive association with suicide in younger people and a negative association in older age groups. Indeed, during the Great Depression of the 1930s, suicide rates rose significantly, and fell with the improvements in the economy and reduction in unemployment in the 1940s.
Is there no sign of hope? There may be some.
As some of you know, my other interests include Obesity and weight management, which was the case study of my research for 4 years.
Last year I wrote a review of a paper on the lessons from Cuba’s experiences with the prolonged economic crisis of 1989-2000. Researchers from the Johns Hopkins Bloomberg School of Public Health, Cienfuegos, Cuba, and Loyola University observed the impact of population-wide weight loss due to sustained reductions in caloric intake and an increase in energy output. They reported that during this time, obesity declined, as did deaths attributed to diabetes, coronary heart disease and stroke.
Reviewing the paper then, I had written:
“This is truly a unique – if unreplicable and unfortunate – experiment. The lessons serve to strengthen further the literature on the benefits of weight loss and the association between obesity and ill health. However from a practical perspective, the study does not add much.
Finding a way to reduce population-wide caloric intake and increase population-wide physical activity is the holy grail of obesity policy. The success of such initiatives depends largely on individual effort and initiative. Recent developments include incentives and disincentives from the payer in the healthcare provision industry.
However unless we are motivated to improve our own health, which is not really happening, the holy grail shall remain a mirage, which gets further as we chase it.”
I may yet eat my words (pun unintended, but entirely suitable).
If we are in for a prolonged period of economic recovery, we may gain an inadvertent benefit with slimmer bodies, and a lower rate of diabetes, coronary heart disease and stroke.
* The second half of this post is strictly tongue-in-cheek. However if we cannot keep a sense of humour alive and try to stay resilient, it is unlikely we will come out unscathed from this credit crunch. We are all in this together, for a change from America to China and all in between.