“When we moved here there was nothing but farm land for miles around” is what the original owners of our home said to us during the purchase transaction at the title company when we bought our home.  Today, we feel we’re living near the heart of the city even though downtown is about 20 miles away.   We never got to see how the area changed from vast farm lands to tall buildings, strip malls, shops and tons of freeways and bridges.   For us the surrounding area always had a lot of activity.   It feels like almost every other year there is a new tall building being constructed a few miles from our home.

Archaeologists have a theory on Easter Island regarding the destruction of the ecosystem whereby natives slowly chopped down all the trees over a period of time to the point where the ecosystem was completely destroyed and could no longer support human life.   I suspect that the eldest generation lived on the island with an overabundance of trees, the second generation witnessed diminishing forests and the third generation thought having a few trees on the island as “normal” since this is how they grew up observing the island.

In my opinion, the financial ecosystem is suffering a systemic degradation similar to Easter Island along with the same “lost generational knowledge” of the old fiscal system.   We’ve all read about the Great Depression or heard about it and some of us have family that lived through it but what is was really like day to day has been forgotten.   From the point past the Great Depression, there is a historical perspective that things would only get better and we would always be at the stage of  “overabundance” so my guess is that the baby boomers, having lost the generational knowledge of the great depression generation, became accustomed to living in a world of overabundance.

Generation X’ers grew up to see the environmental movement (perhaps the world isn’t overabundant), the oil shock of the late 70′s, the cold war, and the fall of the Soviet Union.

Generation Y has grown up to see the financial collapses of the Nasdaq and Dow over the past decade, the highly volatile commodity prices and a certain understanding that financial and natural resources are deteriorating at an amazing rate.

The big question in my mind is whether the younger generations will simply continue on through the assumption that it is normal for the world to function at a deteriorating rate like that last generation on Easter Island or if real change will come soon.

Happy Father’s Day!