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crash2006

The Global Economy Is At The Point Of Maximum Danger

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It feels like the summer of 1931. The world's two biggest financial institutions have had a heart attack. The global currency system is breaking down. The policy doctrines that got us into this mess are bankrupt. No world leader seems able to discern the problem, let alone forge a solution.

The International Monetary Fund has abdicated into schizophrenia. It has upgraded its 2008 world forecast from 3.7pc to 4.1pc growth, whilst warning of a "chance of a global recession". Plainly, the IMF cannot or will not offer any useful insights.

Its "mean-reversion" model misses the entire point of this crisis, which is that central banks have pushed debt to fatal levels by holding interest too low for a generation, and now the chickens have come home to roost. True "mean-reversion" would imply debt deflation on such a scale that would, if abrupt, threaten democracy.

advertisementThe risk is that these same central banks will commit a fresh error, this time overreacting to the oil spike. The European Central Bank has raised rates, warning of a 1970s wage-price spiral. Fixated on the rear-view mirror, it is not looking through the windscreen.

http://www.telegraph.co.uk/money/main.jhtm...1/ccview121.xml

Well Mister Ambrose Evans- Pritchard if they read my posts years ago we wouldnt be in the mess were are in, you now know its going to get a lot worse.

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When the link between the dollar and gold was broken?

More that the US decided to start strongarming the world rather than paying it's bills than anything to do with gold per se, but yes.

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would imply debt deflation on such a scale that would, if abrupt, threaten democracy.

I'm intrigued by the notion that a little financial difficulty should 'threaten democracy'. Though wiser heads than mine have criticised democracy, they have had the wit to realise that it is the least worst option.

Other than anarchy, I can't imagine the present financial difficulties switching to any other (lack of / form) of government? Surely even the meanest intellect has given up on the promises of demagogues?

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I'm intrigued by the notion that a little financial difficulty should 'threaten democracy'. Though wiser heads than mine have criticised democracy, they have had the wit to realise that it is the least worst option.

Other than anarchy, I can't imagine the present financial difficulties switching to any other (lack of / form) of government? Surely even the meanest intellect has given up on the promises of demagogues?

I can remember reading somewhere on the interwebby thing a quote saying that all democracies will eventually fail due to people voting for loose fiscal policy - they will always vote for whoever puts more money in their pocket, thus encouraging the government to interfere in markets.

I remember thinking that it was an interesting idea at the time but was not able to find anything to support it - any ideas anyone?

F

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I can remember reading somewhere on the interwebby thing a quote saying that all democracies will eventually fail due to people voting for loose fiscal policy - they will always vote for whoever puts more money in their pocket, thus encouraging the government to interfere in markets.

I remember thinking that it was an interesting idea at the time but was not able to find anything to support it - any ideas anyone?

F

http://video.google.co.uk/videoplay?docid=...144658400754670

Some references on this video about monetary history. The falls of Greece, Rome, France are all mentioned and briefly outlined.

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I thought the point of maximum danger was last Agust just before the FED adopted the moral hazard whole heartedly?

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  • 399 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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