It was more like 2-3 years and it was generally accepted as a depression when it happened. From 1919-20, federal spending was reduced 65 percent. The New York Fed raised its discount rate to a record high 7%. From its peak in June 1920, the CPI fell 15.8 percent over the next 12 months. I wouldn't exactly say those were normal times.
Shortie, The DEPRESSION is not that of our Grand Parents. The DEPRESSION is that of Ipods, Flat Screen Tvs, Cell Phones, and all that for the leaches and free loaders. 20% unemployment still leaves 80% employed as well. Higher inflation, lower wages, and more unemployed will ripple through this nation. There is no end in sight as the UNEMPLOYMENT IS STRUCTURAL and nobody is creating a plan other than SPEND MORE MONEY. Majority of the people do not trust Wall Street. This market is going up on light volume, volume is not returning. PERIOD. Banks, HFT, and locals on the floor are trading against each other. The average joe is now out of the "TRADING GAME" and Day trading is dead. Except here on ET where it still has a lingering stench. Credit Card spending is UP UP UP . HOUSING is lower than it was in the 1930s. ....the housing ATM IS TAPed OUT! The floor or semi floor in the market is artificial and once the GOV stops proping up the Housing market, it will drop even harder! States are broke, Keep in mind. A GENERATION OF WEALTH LEVERAGE is UNWINDING. This country has yet to even reach the true pain threshold. Keep an eye on the Layoff numbers in the next few months. Fall and Winter are going to be far worse than 07 and people are really going to wake up. But what do I know? MK has a valid point as well.
I'm only stating what Greenspan himself said many times -- that the market would take care of excesses if left alone. In fact this was his response when directly confronted on numerous occasions with excesses in the mortgage industry. He was the chief regulator, but he did not believe in regulation! To his credit, he has now admitted that he made serious mistakes.