The Great Recession of 2009
Is this the Great Depression again? Is this a repeat of 1929? Is this the big one? One year after the so-called subprime crisis erupted, we now know it is global, and it is huge. It will certainly affect almost everyone in almost every country in the world.
Like the massive explosion of the Krakatoa volcano in 1883, in Indonesia, which scattered ashes and dust into the skies and caused strange atmospheric phenomenon and impacted meteorology for 2 or 3 years all over the globe, now we are witnessing a colossal economic eruption, the biggest in our lifetimes. It seems this is an economic earthquake, a financial tsunami, a monetary collapse spreading like wildfire across the globe. Banks falling, insurance companies near default, financial giants saved by governments, stock markets crashing or being shut down to avoid panic. There is a stock market and real state implosion worldwide, a credit crunch of global proportions, and a gradual stalling of economic activity. Central banks across the globe are fighting to avoid a generalized financial crisis and to soften fears over banks and savings. Banks are being nationalised in several countries to avoid bankruptcy, on a case by case basis, for now… But will it work if it keeps spreading? Economies in western countries are obviously in recession this year and all of the OECD will probably be in the midst of the Great Recession, in 2009. OPEC and emerging economies like Brazil, Russia, China, India are not strong enough to counter the trend, due to exports slowing, due to commodities' prices falling, so be it OECD, OPEC, BRICs or anyone else, this seems to be the perfect storm, and a real global one.
How did this happened? Is there any valid explanation for what we are undergoing? Where are the roots of this nightmare?
Look back for a while. Let’s go back to the 70’s, to the 80’s, to the 90’s. Do you remember where all of us, in general, invested our money, our energy, our time, for years? Can you tell where did we spend the credit from the bank and where did we invest our savings and spent our revenues, for years? Well, we invested a lot in homes, in new houses, in bigger houses, in holiday houses, in second or third residences. We also had to buy homes when we divorced, naturally, because we had to duplicate or replicate everything. Then we needed new cars every two to four years, and per family we needed at least two or three cars, plus a four wheel drive or a SUV. Some of us even needed badly boats, yachts and other “essentials”. Of course, part of the time, and a portion of the income, was spent, for young and old, rich and poor, in drugs, alcohol, sex, red light districts, luxury goods, casinos, and so on. Common people also became travelling like mad, crossing over the Atlantic just for a swim in the caribbean waters, the following year to Bali or Phuket beaches just for laying in the sun there. Also, there was plenty of credit for all kinds of new fancy gadgets, home appliances, design furniture, fashion clothes, or plastic surgery.
Then we started to see some results of all this in society. Natality rates plunged, families had very few kids. We had been much more concerned about our assets than about human ties and family ties, we were much more vocal about “gay rights” then regarding raising a family. We were much more eager to defend “abortion rights” than to have babies. Contraception dictatorship was in place since the 60’s now…We had fun mocking at religion and tradition, and in the way created lots of new gods and goddesses: football players, pop singers, movie stars. These would amass huge fortunes in a matter of months or a few years just out of the excitement of the crownds. Churches and cathedrals emptied, we got brand new ones, stadiums, shopping malls. Where we had previously Saints and God to respect, now movie stars, singers, sportsmen filled up our empty lives and souls, Cannes, Hollywood and sports arenas turning into places of real or televised pilgrimage.
Out of a sudden, the party seems to be over. We are now getting worried about the economy and our pension funds, about social security protection, about medical cover. We are getting alarmed at bankruptcies' news and skyrocketing unemployment. Our savings and our wealth seems to be melting down every day in the global financial market place. And there is no solution in sight to restart and put vitality into this economy. In fact there are lots of liquidity injections everyday, but where is the new blood to get it back to life? We forgot about it for too long so there is no way to avoid paying the price now.
Like the massive explosion of the Krakatoa volcano in 1883, in Indonesia, which scattered ashes and dust into the skies and caused strange atmospheric phenomenon and impacted meteorology for 2 or 3 years all over the globe, now we are witnessing a colossal economic eruption, the biggest in our lifetimes. It seems this is an economic earthquake, a financial tsunami, a monetary collapse spreading like wildfire across the globe. Banks falling, insurance companies near default, financial giants saved by governments, stock markets crashing or being shut down to avoid panic. There is a stock market and real state implosion worldwide, a credit crunch of global proportions, and a gradual stalling of economic activity. Central banks across the globe are fighting to avoid a generalized financial crisis and to soften fears over banks and savings. Banks are being nationalised in several countries to avoid bankruptcy, on a case by case basis, for now… But will it work if it keeps spreading? Economies in western countries are obviously in recession this year and all of the OECD will probably be in the midst of the Great Recession, in 2009. OPEC and emerging economies like Brazil, Russia, China, India are not strong enough to counter the trend, due to exports slowing, due to commodities' prices falling, so be it OECD, OPEC, BRICs or anyone else, this seems to be the perfect storm, and a real global one.
How did this happened? Is there any valid explanation for what we are undergoing? Where are the roots of this nightmare?
Look back for a while. Let’s go back to the 70’s, to the 80’s, to the 90’s. Do you remember where all of us, in general, invested our money, our energy, our time, for years? Can you tell where did we spend the credit from the bank and where did we invest our savings and spent our revenues, for years? Well, we invested a lot in homes, in new houses, in bigger houses, in holiday houses, in second or third residences. We also had to buy homes when we divorced, naturally, because we had to duplicate or replicate everything. Then we needed new cars every two to four years, and per family we needed at least two or three cars, plus a four wheel drive or a SUV. Some of us even needed badly boats, yachts and other “essentials”. Of course, part of the time, and a portion of the income, was spent, for young and old, rich and poor, in drugs, alcohol, sex, red light districts, luxury goods, casinos, and so on. Common people also became travelling like mad, crossing over the Atlantic just for a swim in the caribbean waters, the following year to Bali or Phuket beaches just for laying in the sun there. Also, there was plenty of credit for all kinds of new fancy gadgets, home appliances, design furniture, fashion clothes, or plastic surgery.
Then we started to see some results of all this in society. Natality rates plunged, families had very few kids. We had been much more concerned about our assets than about human ties and family ties, we were much more vocal about “gay rights” then regarding raising a family. We were much more eager to defend “abortion rights” than to have babies. Contraception dictatorship was in place since the 60’s now…We had fun mocking at religion and tradition, and in the way created lots of new gods and goddesses: football players, pop singers, movie stars. These would amass huge fortunes in a matter of months or a few years just out of the excitement of the crownds. Churches and cathedrals emptied, we got brand new ones, stadiums, shopping malls. Where we had previously Saints and God to respect, now movie stars, singers, sportsmen filled up our empty lives and souls, Cannes, Hollywood and sports arenas turning into places of real or televised pilgrimage.
Out of a sudden, the party seems to be over. We are now getting worried about the economy and our pension funds, about social security protection, about medical cover. We are getting alarmed at bankruptcies' news and skyrocketing unemployment. Our savings and our wealth seems to be melting down every day in the global financial market place. And there is no solution in sight to restart and put vitality into this economy. In fact there are lots of liquidity injections everyday, but where is the new blood to get it back to life? We forgot about it for too long so there is no way to avoid paying the price now.
Mensagens
Sem comentários:
Enviar um comentário