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Global Economy To Shrink; Deflation Greatest Threat, Says Un

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http://business.timesonline.co.uk/tol/busi...icle5526579.ece

The deepening global recession means that the world economy as a whole could shrink next year and will battle to avoid destructive Thirties-style deflation, the United Nations said yesterday.

The UN alert over what threatens to be the worst year for the global economy since the Second World War came as fears of deflation were stoked when US producer price inflation slid into negative territory, registering an annual fall of 1.5 per cent last month.

In a bleak assessment of world prospects, the UN said that the global economy was now deteriorating at such a pace that its main projections in yesterday’s grim report were already out of date.

Rather than its main published forecast for world growth this year of a meagre 1 per cent, the UN said that its more pessimistic scenario of zero growth, or outright global decline by 0.4 per cent, was now more realistic.

Heiner Flassbeck, director of globalisation and development strategies at the UN Conference on Trade and Development (Unctad), said: “There is nothing unfortunately at the moment where we can say ‘this is positive’ or ‘this is giving a positive stimulus’ . . . For the world as a whole, the outcome could be zero, or even slightly below zero [growth]. I do not say this will go on for ever, but the coming months will get extremely tough.”

Mr Flassbeck said that the greatest threat now came from deflation of the sort suffered during the Great Depression, when falls in wages of 10 to 15 per cent in some economies triggered a drastic slump in consumer demand and brought world growth to a virtual standstill.

With official interest rates across the West tumbling towards zero, the UN issued a call for coordinated fiscal stimulus packages in countries around the world, such as that being planned by the incoming Obama Administration in the US.

The UN now joins the it's deflation camp and mentions the great depression.

If it wasn't so serious it is amusing watching the so called experts flail around helplessly.

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Given the figures on:

China GDP

Shipping Rates

Oil inventories increase

Anecdotal evidence from the British High Street

Bank of America insolvency

We are headed for Great Depression II :(

Edited by 1929crash

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Given the figures on:

China GDP

Shipping Rates

Oil inventories increase

Anecdotal evidence from the British High Street

Bank of America insolvency

We are headed for Great Depression II :(

F*ck yeah! I wonder how much my savings will be worth in 12 months time? :lol:

I reckon I might make a sideline in soup kitchens, based off jamie oliver's healthy eating menus...

Or do you reckon people will be better off with high calorie foods instead of using expensive gas/elec central heating?

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F*ck yeah! I wonder how much my savings will be worth in 12 months time? :lol:

I reckon I might make a sideline in soup kitchens, based off jamie oliver's healthy eating menus...

Or do you reckon people will be better off with high calorie foods instead of using expensive gas/elec central heating?

There might be a good demand for ropes and collapsible step ladders. Get down B & Q quick.

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  • 284 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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