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Deutsche Bank Chief Economist: ‘ The World Is In Trouble ’

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‘The World Is in Trouble’: Deutsche Bank Chief Economist

Published: Wednesday, 12 Aug 2009 | 9:55 PM ET Text Size By: CNBC.com

The global economy still faces turmoil as government try to figure out how to move out of fiscal rescue packages, which could lead to another two downturns, Deutsche Bank Chief Economist Norbert Walter said Thursday.

In addition, nervousness on the part of major dollar holders could pressure the greenback and lead to a very worrying 2010, Walter said.

Norbert said recently in research notes “the world is in trouble.â€

“I believe that the rescue packages brought on have been so costly for so many governments that the exit from this fiscal policy will be very painful, very painful indeed,†he said. “Some of us are already talking about a W-shaped recovery. I’d probably talk about a triple-U-shaped recovery because there are so many stumbling blocks here to get out of this.â€

“There are a few countries that have not dismissed people, they had a dramatic drop in their sales but they kept on people because they believed the recession would be very shallow,†Walter said. “They now have to fire people. That will increase unemployment and they therefore, of course, may be endangering retail sales in some countries.â€

If Australia hikes rates in September or October, markets “will certainly shiver†and cause zig-zagging at the bottom of the recession, Walter said.

And while the White House struggles with issues like health care and puts a fiscal policy exit strategy on the back burner, there are big concerns of about the direction of the U.S. dollar.

“I’m deeply worried about the worries of those investors who have invested a lot, really a lot into the dollar†like the Chinese, Japanese, Arabs and Russians, he said.

“If they have second thoughts about the quality of this currency then the dollar is bound to weaken†which means higher long-term interest rates for a country where government debt is approaching 100 percent of gross domestic product, he said.

If that happens, “2010 could be a worrisome year for all of us,†he said.

http://www.cnbc.com/id/32396144

Video interview at the above link.

This ties in well with the Elizabeth Warren revelations about the true state of the US banks.

http://www.msnbc.msn.com/id/22425001/vp/32385463#32385463

Edited by MOP

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Guest Daddy Bear
I'm sure the stimulus packages will keep things on the up through until the second half of 2010 at the earliest. Early 2011 at the latest.

Its the stimulus packages that are the problem.

“I’m deeply worried about the worries of those investors who have invested a lot, really a lot into the dollar†like the Chinese, Japanese, Arabs and Russians, he said.

“If they have second thoughts about the quality of this currency then the dollar is bound to weaken†which means higher long-term interest rates for a country where government debt is approaching 100 percent of gross domestic product, he said.

like the Chinese, Japanese, Arabs and Russians

They are going to be paid back in worthless paper by the time this goes through

.....then the dollar is bound to weaken...

You don't say ....

which means higher long-term interest rates for a country where government debt is approaching 100 percent of gross domestic product

Now that my friend is where you are wrong. It is an impossibility. Man people are thick - how do they get where they are?

Edited by Daddy Bear

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I thought the recession was now over in the Eurozone. :blink:

We are just being fed wall to wall B*llshit at the moment by politicians, economists and the media.

We just had the biggest credit bubble in history

Followed by the biggest bank bail outs in History

And when the Sh*t finally hits the fan we are going to have the worst depression in History

IMO.

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I'm sure the stimulus packages will keep things on the up through until the second half of 2010 at the earliest. Early 2011 at the latest.

I don't think so. Elizabeth Warren is overseeing the US "Emergency Economic Stabilization Act" and has just lifted the lid on the true state of the US banks. It's not pretty. She expects the next wave to hit the banks in early 2010 when the heavy loses from the Option-ARM/ALt-A/CRE defaults start to kick in.

http://www.msnbc.msn.com/id/22425001/vp/32385463#32385463

If the banks are still under water now, how will they cope when this all kicks off in early 2010?

Edited by MOP

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Guest Daddy Bear
I don't think so. Elizabeth Warren is overseeing the Emergency Economic Stabilization Act has now lifted the lid on the true state of the US banks. It's not pretty. She expects the next wave to hit the banks in early 2010 when the heavy loses from the Option-ARM/ALt-A/CRE defaults start to kick in.

http://www.msnbc.msn.com/id/22425001/vp/32385463#32385463

If the banks are still under water now, how will they cope when this all kicks off in early 2010?

And people really want to be in cash in 2010 ?

It sends a shiver down my spine.

Edited by Daddy Bear

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CNBC report eh? Even that weird gimp Brown is more accurate in his predictions, and he himself, is a laughing stock.

With CNBCs art cashins style reports, they can never ever be taken seriously.

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CNBC report eh? Even that weird gimp Brown is more accurate in his predictions, and he himself, is a laughing stock.

With CNBCs art cashins style reports, they can never ever be taken seriously.

Which part of "Deutsche Bank Chief Economist" did you not understand?

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I thought the recession was now over in the Eurozone. :blink:

We are just being fed wall to wall B*llshit at the moment by politicians, economists and the media.

We just had the biggest credit bubble in history

Followed by the biggest bank bail outs in History

And when the Sh*t finally hits the fan we are going to have the worst depression in History

IMO.

halleluiah!

There just ain't no avoiding this financial malaise possible.

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Guest The Relaxation Suite
And people really want to be in cash in 2010 ?

It sends a shiver down my spine.

Of course people want to be in cash. We're not going to have the ole guns-and-beans scenario, and we're not going Weimar either. The reality is property is going to lose significantly more of its value from this point, and will stay depressed for years and years. In this period IRs are going up, more houses will be repossessed, and cash in banks will earn more and more.

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Which part of "Deutsche Bank Chief Economist" did you not understand?

Art Cashin is floor operations manager for UBS and he talks utter shite aswell. What part of 'Art Cashin' do you not understand?. As an extra, what part of 'CNBC report eh?' do you not understand? With dumb idiots like you about, with nothing to come back on except a pathetic ''Which part of "Deutsche Bank Chief Economist" did you not understand?'', no wonder the UK has gone to the dogs :lol:

If you are of the ilk who will swallow the garbage of a two bob bit economist, you need help :rolleyes:

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Art Cashin is floor operations manager for UBS and he talks utter shite aswell. What part of 'Art Cashin' do you not understand?. As an extra, what part of 'CNBC report eh?' do you not understand? With dumb idiots like you about, with nothing to come back on except a pathetic ''Which part of "Deutsche Bank Chief Economist" did you not understand?'', no wonder the UK has gone to the dogs :lol:

If you are of the ilk who will swallow the garbage of a two bob bit economist, you need help :rolleyes:

Who let you out for the day. :rolleyes:

I know who Art Cashin is and he's a tw@t, but this article is not about Art Cashin or CNBC, it's about

Deutsche Bank Chief Economist Norbert Walter

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Guest Daddy Bear
Of course people want to be in cash. We're not going to have the ole guns-and-beans scenario, and we're not going Weimar either. The reality is property is going to lose significantly more of its value from this point, and will stay depressed for years and years. In this period IRs are going up, more houses will be repossessed, and cash in banks will earn more and more.

So why is oil rising now to $70?

Why are global stockmarkets rising?

Why are nearly all commodity prices rising?

Why is lending increasing again in UK mortgage market?

Why have the Halliwide indices been showing rises in UK property for last few months?

Why is Germany and France officially out of recession?

Why are UK retail sales still very high?

Why is Gold on the verge of an all time high?

Why are the US$ and UK £ on a downward trend

Why are prices rising on most things that I buy in the shops rising?

Why are withdrawls from banks and building societies at record highs?

It all seems very strange...... WHY?

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Of course people want to be in cash. We're not going to have the ole guns-and-beans scenario, and we're not going Weimar either. The reality is property is going to lose significantly more of its value from this point, and will stay depressed for years and years. In this period IRs are going up, more houses will be repossessed, and cash in banks will earn more and more.

So simple, but yet so spot on.

Cash is the banker's tool and so will always win the day. Those hoping for gold, beans or whatever else can keep on dreaming.

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Guest Daddy Bear
So simple, but yet so spot on.

Cash is the banker's tool and so will always win the day. Those hoping for gold, beans or whatever else can keep on dreaming.

Cash is the banker's tool and so will always win the day

dollarindex_thumb.gif

I think you may be the tool......

Those hoping for gold, beans or whatever else can keep on dreaming

Try commodities or UK housing

Edited by Daddy Bear

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dollarindex_thumb.gif

I think you may be the tool......

Try commodities or UK housing

You think I may be the tool? Yes, a useful tool.

On the other hand, you may be a fool!!

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Try commodities or UK housing

You're so gonna regret buying that house. Still, a fool and their money :lol:

BTW, hope you have enough money to pay your council tax soon :o

Edited by Craig77

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And people really want to be in cash in 2010 ?

It sends a shiver down my spine.

Maybe, maybe not, I am waiting and ready to move if the need be. Now is the time for vigilance, not panic.

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Guest Daddy Bear
You're so gonna regret buying that house. Still, a fool and their money :lol:

BTW, hope you have enough money to pay your council tax soon :o

You're so gonna regret buying that house. Still, a fool and their money

32% off and I STR'd at the peak....

hope you have enough money to pay your council tax soon

you too + rent money... :D

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