HISTORY serves two major purposes:
- To predict the future through the past
- To guide what should be done to meet the future.
History must be based on facts without opinions, guesses, or spin, on real and factual data.
HISTORY’S FIRST PURPOSE:
So what does history predict is going to happen after the coronavirus pandemic and economic upheaval finally subsides and passes?
There are three examples similar to the effects caused by the coronavirus crisis. The facts in the first portion of each example are scary and uncomfortable to look at as they affect real people in very real ways. The facts in the second portion of each example are surprising and reflect the American spirit to rise to challenges and turn them into new opportunities. The last portion of each example is a reassuring summary.
- A hundred years ago in 1920, the world was just coming out of the Spanish Flu pandemic. Here are the historical facts:
- 27% of the world’s population (1.8 billion people in 1920) were infected. That is over 500 million people infected. That was one out of every four people.
- If the Spanish Flu happened today with the world population over 7.7 billion, there would be over 2 billion people infected.
- The death toll from the Spanish flu was 50 million people worldwide. That is one person in ten who had been infected died. (Note: due to the challenges of worldwide reporting back in 1920, some estimates say there was up to 100 million deaths).
- If the Spanish Flu happened today with 2 billion people infected, there would be 200 million deaths worldwide.
- In the United States, the population in 1920 was 104.5 million with 28% reported infected i.e. 29.4 million. This resulted in 675,000 deaths. Half of the Americans who died in World War I died not in battle or from wounds but from the Spanish Flu.
- The Spanish Flu lasted from January 1918 to December 1920 i.e. almost 3 years.
- The period from 1920 through October 1929 was called the “Roaring Twenties” and was the birth of the “American Dream” where every American had the opportunity to become a success no matter who they were. Here are the historical facts:
- The Roaring Twenties was a decade of economic growth and widespread prosperity. There was both a boom in construction and rapid growth of consumer goods.
- The 1920s created chain and department stores; consumer credit; and assembly line manufacturing producing electrical and gas household appliances, automobiles, and mass-produced goods.
- The American author Bill Bryson stated: “No other country in history had ever been this affluent and it was getting wealthier daily at a pace that was positively dizzying”.
- An increased gross national product brought rise to the standard of living for every American.
- America moved from the horror of World War 1 with close to half million casualties (116,000 deaths) followed by the Spanish Flu pandemic with over 29 million infected (675,000 deaths), to the country described as being “No other country in history had ever been this affluent” in the span of just a few years.
So the fact is there are hope and prosperity even after a global world war and a worldwide deadly pandemic.
- At the end of the 1920s, the Great Depression started and became the worst economic catastrophe in history. The stock market crashed in October 1929 sending it into a panic and wiping out millions of investors. Here are the historical facts:
- The great depression started with the stock market crash in 1929. Between 1929-1933 the stock market lost almost 90% of its value.
- Industrial Production dropped 47% between 1929-1933. The highest percentage of the 15 industrial countries in the world at that time.
- The United States’ GDP (Gross Domestic Product) dropped by 30% between 1929-1939
- Almost 300,000 companies went out of business.
- 11,000 (50%) banks in America failed, wiping out 1 billion dollars in deposits.
- Almost 25% of the United States’ workforce was unemployed.
- The average family income dropped by 40%.
- As America took action, Americans rallied during the 1930s and rebuilt not only the economy but came to the rescue of the free world during World War 2.
- Government economic recovery programs built the modern US infrastructure of highways, bridges, dams, power plants, waterways, national parks, etc. This created huge demands for engineers, heavy equipment operators, skilled workers, and laborers. There was a resulting increase in demand for steel, concrete, building materials, trucks, heavy construction equipment, tools, work clothes, etc.
- More millionaires were made during the 1930s than any other time in history.
- By the end of the 1930s, the country’s industrial production and capacity had improved so much that the United States was able to support both Great Britain and the Soviet Union’s fight against Germany and Italy in the early years of World War 2. The United States gave:
- The equivalent of 354 billion dollars to Great Britain and
- The equivalent of 127 billion dollars to the Soviet Union
- The equivalent of another 54 billion dollars to the rest of the allies.
- In addition to the cost of the United States defeating Germany and Japan, the United States after the war spent the equivalent of 18 billion dollars rebuilding Japan and the equivalent of 135 billion rebuilding Europe.
- During the 1930s the United States was one of the seven great powers in the world. By the end of World War 2, the US emerges as one of two.
- During the 1930s, America recovered from the greatest financial collapse in history with its economy in shambles and a quarter of its workforce unemployed waiting in long soup kitchen lines for their next meal to becoming a superpower that saved the free world in the 1940s.
The fact is there are hope and prosperity even after a global depression and another world war.
1. Over the last 35 years, there have been 3 financial crises or economic downturns. Each caused panic and fear when they occurred as they caused an unknown and uncertain future.
- Savings and Loan crisis (1986-1995) especially October 19, 1987, known as Black Monday. Here are the facts:
- October 19, 1987, the stock market collapsed by an astonishing 22.6% one-day loss even bigger than the famous Black Friday 1929 stock market crash.
- This crisis led to the failure of 1,043 out of 3,234 Savings and Loan Associations (32%).
- The crisis cost 160.1 billion dollars of which at least 124.6 billion dollars were paid by taxpayers.
- There was a decline in new home construction—one of the key economic indicators of the health of the US economy—dropping to its lowest number since World War II.
- The Savings and Loan crisis contributed to the 1990-1991 recession.
- The government bailout encouraged riskier home loan mortgage practices by banks leading to the 2007-2008 subprime mortgage financial crisis.
- Dotcom Financial crisis (1999-2002) was the result of over-speculation in the high tech sector of the stock market especially the booming internet market. Here are the facts:
- March 10, 2000, the NASDAQ hit its high of 5,049 and by October 9, 2002, it closed at 1,114 – a loss of 78%. One week alone (the week ending April 14, 2000) saw the NASDAQ nosedive, losing 25% of its value.
- Many online companies that were heavily invested in, went out of business: Webvan.com (groceries) Pets.com (pet supplies), Boo.com (retail), Worldcom (second-largest long-distance carrier), NorthPoint Communications (local data exchange carrier) and Global Crossing (computer networking).
- Also, hit hard were technology stocks during this time (between 2000 through 2002):
- Cisco Systems Inc’s stock crashed by 86% of its value
- Amazon tumble 73%
- Apple’s stock fell 72%,
- Microsoft lost 59%,
- Intel dropped 58%
- eBay declined by 55%
- January 2001 only 3 high tech companies advertised during the Superbowl down 75% from the 12 high tech companies advertising the previous year.
- Subprime Mortgage Financial crisis (2007-2010):
- This crisis was the major contributor to the Great Recession (2007-2009) deep recession with nearly 9 million jobs lost (6% of the workforce) with employment not returning to the 2007 levels until mid-2014.
- The stock market declined by around 50% by the first quarter of 2009 and did not come back up to 2007 levels until late 2012.
- The United States GDP (Gross Domestic Product) dropped by 40% from the 2007 levels.
- Household net worth dropped by more than 12 trillion dollars (20%) from its 2007 level and did not recover until the end of 2012.
- Between June 2007 to November 2008, Americans lost 25% of their worth.
2. After each of the financial crises above, there was a period of sustained growth fueled by creative ingenuity and innovations. Here were the results:
- After the Savings and Loan crisis ended (1995), new housing starts recovered which reflected broad economic growth:
- New home construction went up each of the ten years (1995 to 2005) after the Savings and Loan crisis.
- In 2005, 1,283,000 new homes were built almost double the number built in 1995 of 667,000 new houses.
- New housing starts hit a 13 year high in December 2019 to 1,625,000 the best since December 2006.
- After the dotcom financial crisis many high tech companies recovered and became some of the most successful companies in the world:
- After 5 years of rising, the NASDAQ was up over 300% by October 2007 (3,539) from the low of 1,114 in October 2002. The Subprime Mortgage Financial crisis delayed the full recovery of the NASDAQ to its highest level until December 2017.
- Many of the technology companies that struggled during the dotcom financial crisis not only survived but thrived afterward (current Fortune 500 listing):
- Apple (3)
- Amazon (5),
- Google (15),
- Microsoft (26),
- Intel (46),
- Cisco Systems (48),
- All the speculation that led to the dotcom financial crisis also made advances in technology possible including websites with high-quality graphics, cloud storage resulting in big data analytics and software as a service, the evolution of the cell phone, etc.
- The cell phone evolution exemplified creative ingenuity and innovation from 1995 through to 2018.
- In 1995 cell phones were the size of a brick, heavy with long external antennas.
- Each year brought new innovations surpassing the previous year’s from a number of companies including:
- Nokia (1995, 1998, 1999, 2001, 2003, 2008, 2010, 2011),
- Motorola (1996, 2000, 2004, 2009),
- AT&T (1997),
- Samsung (2002, 2012, 2013, 2015),
- Sony (2005),
- LG (2006),
- Apple iPhone (2007, 2012, 2014, 2016, 2017, 2018),
- By 2012, the cell phone had evolved from the 1995 brick-sized mobile phone into a mobile computer, with GPS, radio, camera, personal music player, video entertainment center with internet connection while fitting into your shirt pocket.
- In 2019 almost 30% (12 out of 42) of the Superbowl commercials were done by tech-related companies.
- After the Subprime Mortgage Financial crisis (2007-2010):
- Of the 626 billion dollars in government bailout money given out, 390 billion had been paid back with another 323 billion dollars earned in interest for a total of 713 billion (a profit of 87 billion dollars—over a 12% return)
- The stock market average closing price rose for 12 straight years from 2009 average close of 8,885.65 to hitting its highest close on February 12, 2020, at 29,551.42—a whopping 333% increase.
- Unemployment in the United States dropped from its highest point in 30 years of 9.9% in March 2010 down to 3.5% in February 2020, a 50-year low.
3. Each economic downturn or financial crisis in America was followed by a longer period of prosperity led by creative ingenuity and innovations.
- The Savings and Loan crisis crashed new home construction affecting the whole economy but was followed by a decade of new home construction growth.
- The Dotcom Financial recovery resulted in technology innovations that saw the NASDAQ rise for 5 years gaining over 300% with whole new technologies created.
- The Great Recession caused by the subprime mortgage collapse that crippled the United States economy for years, not only recovered but went beyond to be the strongest economy in the country’s history.
In each of the above financial crises, creative ingenuity and innovations brought about long-term prosperity. Lest you think I am being overly optimistic and not taking the coronavirus and the ensuing destruction of the US economy seriously, I am taking it seriously. I think this crisis may be worse than all the examples above combined. Maybe 10 or even 100 times worse. The point I am making is that people rise up to these challenges and not only overcome them but society eventually flourishes.
For 10 days in October 1962, the world was hours (if not minutes) away from a global thermonuclear war between the United States and Russia. Some experts said it would have put civilization back into the stone age. Yet smarter men prevailed and the US and Russia have co-existed for over 50 years since.
During a four-year period in the mid-14th century (from 1347 to 1351) from 50% to 60% of the population of Europe died from the Black Death with a death toll of between 75 million to 200 million people in Europe and Western Asia. Yet Europe recovered and in the 15th and 16th centuries experienced the period called the Renaissance. One example of the technology innovations that helped create it was the invention of the printing press in 1457 which led to the mass distribution of literature and early modern universities.
Less than 66 Million years ago an asteroid hit the Yucatan Peninsula with the force of one billion atomic bombs the size dropped on Hiroshima creating a crater 62 miles wide and 19 miles deep. It caused a 330-foot high mega-tsunami reaching as far away as North Dakota and New Jersey. There was a global thick cloud of dust particles lasting for years or even decades blocking sunlight reaching the earth’s surface, interrupting photosynthesis by plant life, cooling the surface temperatures dramatically and disrupting the food chains worldwide. The result was the mass extinction of 75% of all plant and animal species on Earth. Yet life rebounded and continued until eventually man appeared.
Life has always found a way to survive and continue that is the point of these examples. So what should we do now?
HISTORY’S SECOND PURPOSE: To guide what should be done to meet the future.
There are roughly three categories that people fall into. Three types of people who actively create the future.
They are best described as:
This term is used instead of owners, founders, executives, etc. as these may not be leaders. Leaders dream dreams, set goals, create plans and have visions of a better tomorrow and are willing to move mountains to achieve these for the good of all.
Leaders lead. They can solve problems rapidly and thoroughly within the given resources they have or see opportunities before anyone else and cleverly take advantage of them again within the resources they have. They think of others and build tremendous teams under them.
Leaders are found in great corporations, medium-sized companies, and small businesses. They greatly affect people positively and should be valued. They are not always successful, but they always try to be. They are rare, numbering only in the tens of thousands worldwide.
Again the term is specifically chosen to describe what is meant. Executives, Directors, and Supervisors are titles, but they may be or may not be good or competent managers. There are always examples of people who are identified as mere employees who are in fact managers and “run the place”.
Managers can take a leader’s dreams, goals, plans, and visions on paper and put them into existence in the real world. They coordinate activities among their teams, rapidly solve inherent problems that result from creating something where nothing had previously existed and more importantly, they care for their people and make them successful.
Leaders often acknowledge their people especially their managers who often graduate up to being leaders themselves. Managers by their actions, long hours, and dedication make both leaders and employees’ successes possible, are to be valued. Good, competent managers number in hundreds of thousands.
The best term I know to describe what is meant for this category is “Team”. While workers, employees, personnel or staff are often used they don’t convey adequately what team means. A team could be said to be:
A number of individuals with the purpose to join forces or efforts, working together to achieve or accomplish the vision, dreams, goals, and plans of their leader, through the direction, coordination, and supervision of their managers.
Team members are self-motivated, work hard, and care about their fellow team members, have respect for and faith in their managers, and loyalty and commitment to their leaders. They know their jobs and the jobs of others around them and are always willing to jump in and help each other. They think of their company as if it was their own and drive for it to succeed.
You hear leaders and managers often mention and thank their team. Additionally, in companies known for their exceptional culture and being a great place to work, it is often attributed to the company’s “great team of employees”.
These three categories cannot be underestimated as throughout history these are the people who have brought about stability, security, prosperity, and certainty about the future, following crises and catastrophes.
Unfortunately, there is a fourth category that I normally simply ignore and spend very little time on. Yet during crises, they do get in the way and therefore I mention them here.
“In-The-Way” is a descriptive term that fits this category very well as these people do GET in the way. If the above three categories are going down a path together to accomplish a goal or achieve something positive, these people get in the way blocking the path.
At the very best, the people in this category sit around, spread worry and do very little but complain. They are depressing to be around and there is a noticeable relief when they are absent. You can often spot them as you will have a natural feeling of apprehension or dread of seeing them or having to interact with them.
At their worse, these people secretly love chaos and destruction as they see it as a way to weaken others around them. It makes them feel superior to others. They spread upset, worry and fear. They speak only of the problems while never offering solutions. When they can, they will try to dominate others to protect themselves and when they fail at that, they will attempt to undermine, belittle, and make less of others behind their backs.
These people fear others and are afraid others will find out their inability to selflessly help others or create anything positive. I spent more time here describing them than they deserve but they do go crazy over anybody trying to solve problems or create something positive.
Therefore, you must be aware of your surroundings and spot them when they appear getting in your way. People who fall into this category can be anyone; relatives, so-called “friends”, colleagues, bosses, employees who report to you or mere acquaintances.
It is best to just ignore them by saying firmly, “You are getting in the way”. Many will simply grumble and walk off as they know they have been spotted causing trouble. Some will blow up and get mad, others breakdown and start crying and a few will promise to reform their ways and help. Your only response to any of these reactions is to say, “See, you ARE getting in the way, please go”. If they going to reform, they will have to do it without distracting you and consuming your valuable time.
Remember if they can, they will try to stop you or what you are trying to create or at least slow you up. Their many tricks include promising to reform, professing they are only trying to help, pleading to be given another chance, or saying you are not being fair. But doing the above will get you to arrive where you are going faster and if someone really wants to reform, they need to work it out without your help.
As detailed above in the examples of past crises, the future holds unforeseen opportunities that will be discovered by Leaders, organized and planned out by Managers and accomplished by Team Members. Although it is hard to predict where specific opportunities will appear or what they will be, people in the first 3 categories must prepare themselves to take advantage of opportunities when they do appear.
Anything that improves one’s ability to perform their jobs no matter which of the above three categories they are in, is better than spending your time only binge-watching TV series or only playing video games, etc. What do you gain once you finish a series? What have you gained after a video game playing session besides passing time?
Sure, watch some and play some but also do something that improves you and puts you in a position to take advantage of the coming opportunities so you personally, your company and the country recover rapidly. Here are some possibilities:
- Catch up on the latest productivity technology especially video conferencing which surely will see continued popularity.
- Learn or refresh your knowledge of the latest in project management technology and software.
- Building websites and other online innovations will boom especially if retail stores fail to recover or if people who have been forced into ordering products online find it too convenient and continue to do so after the crisis passes.
- With people working from home becoming a trend, an innovative app that tracks and encourages productivity seems to be a surefire winner.
- Anything that improves your ability to communicate is time well spent.
Finally, this research was sponsored by an online sales training company. The CEO there wanted to provide the above facts to people to reassure them that there will be a better future after this crisis passes. Further, she wanted to know if her sales training would be of help to people to prepare them for the coming future.
I will take a moment to talk about the benefits of sales training:
- The obvious benefit, of course, is trained salespeople will be in high demand during the economic recovery and historically they are very well compensated with high salaries and benefits.
- But beyond that no matter which of the 3 categories you find yourself in, you will need to sell yourself, your vision, dreams, plans, ideas, etc.
- The key to all sales training is the ability to communicate effectively so it fits perfectly in whatever type of corporation, company or business you find yourself in.
- When you know the technology of how to sell, you have the freedom to go anywhere and work for anybody.
- There is a sales technology based on the research of the top salespeople and what they do in common when they are selling. This was researched for over 25 years so others could learn their most successful best practices.
Take a moment and check out Sellability.com.
Regardless of what you decide to do, DO something now to create your future.
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