Wednesday, November 18, 2009

Reading the Recession through the lens of the Depression

On this week's Lincoln Avenue, I'm talking with Daniel Roth and James Ledbetter about the book they just published together. The Great Depression: A Diary was written by Daniel's father, Benjamin Roth, a Youngstown lawyer who had the foresight to understand, back in the early 1930s, that he was living through an important historical period. He started taking notes on what was happening locally as well as nationally, with a strong focus on the economic and especially the investment lessons to be learned from the Depression.

Roth's focus on economic issues and investing is part of what caught James Ledbetter's eye.  He edits an online economic magazine, The Big Money, published by Slate.  He published excerpts from the diary on his website, noting that the diary's "perceptions and experiences have a chilling similarity to our own era, and The Big Money believes that Roth's words—though they are 75 years old—have much to teach us today."  Roth made note, for example, of how people were buying stocks at one point in 1931, believing they had hit bottom, only to find that stock prices dropped even further. 

As Ledbetter notes in our interview, the Depression was different in some important ways from the recession we're experiencing now, Benjamin Roth's ideas about investing -- especially about making cautious choices -- are useful reminders for us today.  Perhaps even more, his diary reminds us of the value of observation.  Roth followed stock prices and investment strategies closely, even though he was not an investor himself. 

Beyond the book itself, what I hope you can hear in this interview is the camaraderie between the two editors.  For Daniel Roth, this project was a way of honoring his father.  For Jim Ledbetter, it represented an engaging way of getting a fresh perspective on the current economic crisis.  But the process itself -- editing the book and now doing interviews and presentations to promote it -- has created a terrific partnership. 

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