The Contention depression

How we're pacing ourselves for the rest of the year

Enjoy this special edition of Contention, and please subscribe if you have not done so yet — it’s free:

We are all experiencing the consequences of a traumatic year, and some of us are taking it worse than others. 

It is impossible for anybody with even minimal empathy to see 3,000 people die every day for weeks and months on end and not have their minds wounded by the trauma. The injury is made worse by seeing our political system bend to those who revel in their own lack of empathy, refusing to take simple actions to lessen the carnage. And the fact that less hateful societies have avoided all of this means that we could have prevented this pain, death and suffering, but failed to do so.

Writing for Contention in some ways amplifies the trauma because every week we explore why this system is failing. The simple answer: it isn’t failing. The system exists to make more money for the people who already have almost all of it, and the responses to date have accomplished this goal. They have also prevented changes that might have undermined this arrangement long-term. All of the other consequences are irrelevant.      

It’s also traumatic to study the economic consequences for working families in particular. Last week saw an unexpected surge in unemployment, as working people are less able to sustain themselves than they have been in decades. As many as 12 million of them will face eviction, while 50 million are going hungry. Despite this, relief bill negotiations collapsed again last week. Congress could pass a bill when markets and investors were at risk, but not their working constituents -- they too are irrelevant. 

And markets are doing great right now. Yes, all of the major indices were down for the week -- the Dow 0.6%, the S&P 500 1%, and the Nasdaq 0.7% -- but total public company capitalization broke $100 trillion for the first time ever this month, and U.S. equities are up about 50% since March. We’ve talked about why this is happening, but it bears repeating: the fortunes of the vast majority of people are completely irrelevant to the performance of financial markets.

This is especially true for people of the Global South.We are witnessing one of the most rapid de-developments in human history -- its own source of trauma if you go out of your way to see it -- with 150 million people or more slipping into abject poverty over the next year. But the same low interest rates that central banks use to boost asset prices have driven new capital into sovereign debt from so-called “emerging markets.” This is a rare source of significant yield for investors, and the IMF and World Bank effectively underwrite the debt. 

The governments in these countries can protect their credit access by cutting public spending while their people starve, or they can default and see their financial systems crushed. Both create desperate workforces and public asset fire sales -- of course markets are humming in spite of their suffering. 

We can anticipate some of the blowback the system might face from all of this: zombification sapping production, monetizing debts undermining the dollar, etc. But the last two crises have made it clear that the most important investors will find a way to make money nonetheless. Climate change means mounting risk over time, but they will use the rest of us as human shields from the consequences for as long as they can. 

Thinking about all of that day in, day out, is not easy -- especially when it consumes almost all of your downtime outside your day job. That’s the case here at Contention, and it’s why for the rest of December you’ll see a reduced publication schedule. We are going to skip the Monday newsletter for the next few weeks, and lean into our columns instead. We’ll come back strong in January, ready to follow the money and watch the way capital moves in real time. 

The stress and pain associated with this project makes sense if we are informing readers that use the information to understand and then change the world. If that’s you, let us know how we’re helping or what we could cover that would help you even more. If you know others that are organizing and preparing for this work, please pass Contention on to them too:


2020 has been a nearly relentless source of pain and unhappiness. The immediate sources of suffering are hopefully improving. The underlying causes, unfortunately, are only getting worse. Contention started up this year with a mission to be a tool in the worldwide effort to fight back and defend human dignity. We aren’t about to give up, even if we do have to steward our energy so that we can continue into 2021 and beyond. Thank you for being a part of it so far! 


Our only investment advice: Consider slowing down your work too if you can.