Thoughts On “Global Economy On The Verge Of Another Crisis (FreePOM)”
LINK To Earlier Post
Nzallblack Great write up JC. I’ll say hi to Matt for ya.
JC Collins Thanks buddy. Give him a nuggy for me.
neal poole At least outside of Canada (and Australia!)
moksha It sure seems like big changes are close at hand, JC. I can feel it …. Good timely post.
There is no question that no one else even comes close to this analysis. Glad I’m here reading the POM.
Steve Henningsen My only criticism JC is that I believe you’re a little too optimistic regarding the U.S. There has been a lot of misalocation of capital as companies here have used the Feds cheap funds to issue debt.
Many companies would have been out of business years ago if not for cheap debt. I believe a corporate debt default cycle begins next year and will finally wash out many of these poorly managed, highly leveraged companies, beginning with the frackers. This will take a year or two to fully delever corporate America.
While the lower dollar will eventually help stimulate our economy, my guess is that we too shall go through some pain before we turn the corner.
BTW- best of luck to you and your friends, as I agree that there is a lot of financial hurt coming your way. Hopefully, commodities will rebound quicker than we think, which would help lessen the blow for Canadians.
Alan Rebalancing the Global economy: A Primer for Policymaking
June 2010 This is a 215 page, 5yr old document, highlighting:
“The post-crisis world involves a multi-year resetting of the global economy.”
Page 170: Looking forward
The global financial crisis demonstrated that our globalized world has reached a level of international connectivity that far exceeds the reach of national policies and the effectiveness of the global architecture.
It also demonstrated the extent to which the system as a whole lacked the redundancies and circuit breakers that underpin a degree of systemic resilience. Initially, the crisis forced national governments to coordinate their policy responses and to abandon representation mechanisms that made sense 60 years ago but no longer do so today.
Yet the post crisis period is already seeing a dilution in this trend toward greater cooperation. Should we worry about this reversal and can something be done? Yes and yes…”
This is becoming old news for PoM readers.
[I read this document as if it was printed yesterday, very exciting]
Alan But what is certain is that the next crisis is close at hand, and it is a crisis which has been planned for since at least 2009 and 2010. – JC Collins
Press that reset button…
March 3, 2010 “…Mohamed El-Erian, CEO and co-CIO of the world’s biggest bond fund PIMCO, says 2010 is the beginning of the multi-year resetting of the global economy…”
Rodriguez Perez Only one word for your today´s pos, JC: “Magnificent”……..may be another word is possible as well: “Worrysome” …very worrisome, I would say.
As everybody knows ” in scrambled river fishermen (elite) gain”.
This scam has ” No-name”, we have to discover a new one.
Best Regards and congratulations, again.
Moksha JC – This crossed my mind last night and I thought I’d get your opinion on this.
It is starting to dawn on me that they can get all of the effects of an interest rate hike by just talking hawkishly. I don’t think they will need to hike – come Dec.
However, like you said, if RMB inclusion is announced and dollar outflow is more than expected, they might be forced to hike to calibrate the level of dollar depreciation? So I guess the Dec hike really depends on whether RMB inclusion is announced before then. Am I on the right page? Thank you
JC Collins I would say you’re on the right page. All the talk about a rate increase is priming the market for the real thing. And whether the RMB is added first, or the rate increase happens first, the effects will be the same. Events will begin to leap frog one another.
Cadwaladr Time has told and the button has been pressed:
JC Collins Man, you were quick on the draw for that one. Awesome. Thanks.
Curtis What I wonder is how the coming crisis will be used. Will we have tax reform? Maybe. The prevailing belief is that there is a negative outcome (for the masses).
You could argue that everything happens in patterns and that history repeats itself. I would agree with you if you make the concession that there is an evolution of understanding as an old pattern emerges.
Many believe there is a hidden element to government. Perhaps this is so. Perhaps there is an intention of a small group of people to subvert the policies both domestically and internationally in their favor.
My point is that you have to sail on the surface. The development of society is far more than technological. Perhaps you could say that there are statists who embellish the status quo. This may be true in some respects. What I want to say is “So what” to all those who believe in the hidden hand.
Even if only on the surface the public interests must be maintained. I’ve read and some state that an educated populous is not what governments want. Here in the US we have a problem.
People have too much consumption and little foresight to self preservation (retirement). Oh the government should take care of us. No, be self reliant. Liberalism is not the answer.
Daneackerman And People’s Bank of China’s reply to the IMF :)
Dinar Recaps Reminder: We Post from the "Free" Side - Some links to other articles mentioned may take you to the premium side -- Thank You