Over a long and satisfying string of holiday parties, I've been gauging the mood of friends and acquaintances in New York regarding the economic climate we've only half-jokingly come to call "The Depression." Because an unusually large number of my friends are in the arts, media, academia, the law and finance, I'm fully confident that I'm getting a badly distorted view of the coming crunch. These are, after all, the hardest hit sectors. One wag joked that we all belong to the "parasite class," and that the post-Depression economy will have no use for us. Actually, I'm not sure he was joking--I'm pretty sure this guy is heading "back to the land." So take what you read here with a grain of salt.

Though I persist in my naïve optimism, very smart people tell me that we've entered a darkly Biblical moment that could result in the end of human civilization. How's that for doom and gloom?

Globalization, once a force that restrained inflation thanks to all those cheap Chinese-manufactured goods, may have become an inflationary force thanks to the developing world's growing hunger for commodities. Collapsing oil prices reflect collapsing demand. People are marveling at the speed with which a barrel of oil has gone from around $150 to $50. But it's only those last, hard-to-get barrels of oil that are mammothly expensive. When the economy does start turning around, expect commodity prices to spike back up, packing a punch that will knock us back off our feet. Beware of false dawns.

Then there's the concern that we will see the economy oscillate between deflation ("better put your money under your mattress!") and inflation ("better take your money out from under your mattress!"). For those of you who are trying to build wealth, well, you might be better off tending your victory garden and stockpiling cans of soup.

The fact of dramatic wealth inequality will interact with the new economic climate in potentially dangerous ways. Americans have never been particularly inequality-obsessed, but that's mainly because the quality of consumption for all households has consistently improved, even in this era of severe pressure on middle-class wages. Those cheap, Chinese-made goods helped a lot. But if people sense that their economic well-being is actually eroding, something we've seen for much of the past year thanks to the triple-whammy of the housing collapse, the gas price spike and the financial meltdown, expect people to get a lot more exercised about huge fortunes that piled up during the boom years. The left has wanted to reverse inequality for a long time. In a funny way, though, they underestimate the power of exponential math. Ticking up marginal tax rates just a little bit won't reverse wealth inequality. At the same time, tax competition with other countries--there's that globalization, again--means that governments will have a very hard time doing something more dramatic. That means that the pressure to close the borders will grow stronger and stronger.

I've never worried too much about inequality, in large part because of my techno-optimism. Generally speaking, I think that technological progress will over time deliver broad-based prosperity to Americans and also to people in the developing world. When it does, we will link arms and sing "Kumbaya" together. But what if I've been overestimating the rate of technological progress? That is, what if the boom in service-sector productivity was a one-time thing--we applied information technology to retail, and, well, um, Wal-Mart and Target made a lot of money and ... well, that's pretty much it, folks? Moore's Law is still hanging on, but only by a thread--it's gone from a hardware problem to an immensely difficult software problem. And besides, raw processing power and hard science breakthroughs matter a lot less for consumers and workers than the ground-level innovation that turns exotic scientific concepts into real-life productivity-enhancers. That's what we need, and that's what we're not getting.

I want to emphasize that I haven't given up on my techno-optimism. It seems to me that there is a lot of room for improving the way humans interact with machines to make both more productive. I will say, however, that a lot of Silicon Valley venture capitalist types who are at the proverbial cutting edge are distinctly unimpressed by what they're seeing. Let's hope that intelligent robots save us from our creative sloth, and in the process save humanity.

Now back to my little corner of the world. Most of my friends were born a bit before and a bit after 1980, which has been a pretty bright moment in American history, certainly for the college-educated middle class. Fully expecting that the next year would be better than the last, these young people have invested in their skills, kept their noses clean, and they've expected to be rewarded for it. It's hardly surprising that they're taking this whole Depression thing pretty hard. Economists have found that entering the workforce during a recession has a wage-scarring effect, and entering the workforce during a boom has the opposite effect. Recent graduates could look forward to a long period of economic pain. My somewhat older crowd is now entering their most productive years, the years when you settle down and raise a family and rack up professional accomplishments, facing the same headwinds.

What's most surprising is that the mood isn't entirely dark. For the New Yorkers--including some who keenly sense that they're about to lose their jobs--there's a sense that the rich and mighty have been humbled in a good and constructive way, with the ever-present caveat that this is very bad news for the army of working and middle-class service workers who depend on Wall Street largesse. There's a cautious sense that New York, and America, might become a more livable, sane place.