Unemployed men line up outside a soup kitchen in Chicago during the Great Depression in 1931. Photo: US National Archives and Records Administration
Asia Times: ‘Great Depression’ ahead? IMF sounds dire warning
Massive government debts and eroded fiscal buffers since 2008 suggest global dominos await a single market crash.
Is another “Great Depression” on the horizon? It would be easier to dismiss these words from Nouriel Roubini, Marc Faber or other doom-and-gloom prognosticators. Coming from Christine Lagarde’s team, though, they take on a new dimension of scary.
The International Monetary Fund head isn’t known for breathlessness on the world stage. And yet the IMF sounded downright alarmist in its latest Global Financial Stability report, stating that “large challenges loom for the global economy to prevent a second Great Depression.”
Read more ....
WNU Editor: Global debt has been a problem with us for decades. The key to overcome it is to promote economic growth and to hold back governments from growing and borrowing even more money. The U.S. is currently sustaining a growth rate that is around 4% .... but unfortunately growth in U.S. government spending is only increasing. And the U.S. is not the only country pursuing these policies .... almost every country in the world is addicted to debt, and they want more. In the end we will have an economic downturn, and this economic downturn will blow-up government debts to unsustainable levels. I lived through such a depression when the Soviet Union broke up and the economy collapsed in the 1990s. It took a decade to recover, but the Kremlin learned its lessons. Russia today has a balanced budget/foreign currency and gold reserves/and one of the lowest debt levels in the world. But when I think back on those 10 years .... the terrible cost of learning these basic economic rules .... I still shudder on what I and my family had to go through at that time. That is why this IMF warning should be listened to. Unfortunately .... everyone's focus is elsewhere.
5 comments:
The soup kitchen line up would not happen today.. too many broken people out there without a moral code. I believe the power brokers will avert this economic malaise by setting the stage for war beforehand. This debt is unsustainable and people delude themselves thinking we can maintain our current Ponzi scheme without any hiccups.. it’s nice to be utopian.
I think that what will come will be beyond almost anyone's comprehension. The "Great Depression" would pall in comparison. Even countrys such as Russia with prudent economic policies would not emerge unscathed.
JH
Ps. WNU as you pointed out above the world is going there, wherever there is.
One that humankind has never before seen in the history of our species. Followed by Nuclear annihilation.
Russian "prudent policy" has led to ???
I'm not so sure; things are a lot different now with much more robust economics, trade and rules. Also, corporations are sitting on enormous piles of cash who have vested interests not allowing crashes. They are prime to assist and/or take advantage of smaller crashes by buying up poorer companies. In a few decades; corporations will be (some herring close) bigger then some of the top 10 economies. Think about that!
Post a Comment