Crisis in the Economy
When it comes to the economy most people only believe what they want to believe, everything else is blocked out. The warning signs of a coming economic collapse are everywhere. Almost every day there are authoritative voices warning us of a coming economic disaster.
Recently the World Bank issued a very disturbing warning. In an absolutely startling report, the World Bank revised GDP growth estimates for 2012 downward very sharply, warned that Europe could be on the verge of a devastating financial crisis, and declared that the rest of the world better "prepare for the worst."
Andrew Burns, the lead author of the report, said that if the sovereign debt crisis gets even worse we could be looking at an economic crisis that could be even worse than the last one: "An escalation of the crisis would spare no-one. Developed- and developing-country growth rates could fall by as much or more than in 2008/09."
In yet another news item we read, “The European Central Bank should ramp up its buying of troubled euro zone debt to support Italy and prevent a "cataclysmic" collapse of the euro, David Riley, the head of sovereign ratings for Fitch, has warned. Speaking to investors as part of a European road show, Mr. Riley said a collapse of the euro would be disastrous for the global economy, and while it is not Fitch's baseline scenario, it could happen if Italy did not find a way out of its debt problems.”
• The chorus of voices warning of financial chaos is growing by the hour. Here are a few quotes from a recent Bloomberg article.
• John Mauldin, president of Millennium Wave Advisors: "We've got a cancer. That cancer is debt"
• Mark Spitznagel of Universal Investments: "Too much mal-investment has been kept alive, and history shows an inevitable wipeout, which started in 2000."
• Michael Panzner of Financial Armageddon: "The fundamental outlook is even worse now than it was a few weeks ago, given (the lack of positive) developments in Europe and growing evidence that the economies of major countries around the world are deteriorating fast."
• Another warning comes from Joseph Stiglitz, “The days of the US dollar as a global currency, with its overarching charisma as a brand to measure everything from hamburger prices to trade between remote nations could be on the wane, says Nobel-prize winning Joseph Stiglitz. Stiglitz expects a new world reserve system to evolve at the next meeting of the G-20 group of the world’s leading economies.
In China we learn, “A looming hard landing in China will bring the financial and economic crisis of the past five years to a climax in 2012, one of the City of London's leading analysts has warned.”
You do not have to be a financial wizard to see what lies ahead; the flashing red lights are everywhere.
What should we all be looking for next?
March 20th is a key date to watch. That is the day when Greece will either makes its 14.5 billion euro bond payment or it will default.
Greece does not have any hope of making that payment without help from the EU and the IMF. If Greece can reach a satisfactory deal with private bondholders, then the coming Greek default might be "orderly". But if something goes wrong, the coming Greek default might be quite "disorderly".
Almost everyone in the financial world is anticipating a Greek default of one form or another....
• Edward Parker, the managing director for Fitch's sovereign and supranational group in Europe, the Middle East and Africa, recently declared that a Greek default is inevitable.... "It is going to happen. Greece is insolvent so it will default."
• Moritz Kraemer, the head of S&P's European sovereign ratings unit, made the following statement on Bloomberg Television recently. "Greece will default very shortly. Whether there will be a solution at the end of the current rocky negotiations I cannot say."
• Richard McGuire, a strategist at Dutch bank Rabobank, was recently quoted by CNBC as saying the following.... "People often ask if Greece is going to default which ... is a misnomer because Greece is (already) defaulting"
• Diane Swonk, the chief economist at Mesirow Financial in Chicago, says that the default by Greece will probably be an "orderly" one but that the situation could change at any moment.... "It appears at the moment that the market is accepting a Greek default as inevitable, and it will be an orderly default. But that can change on a dime."
Whether there is a default or not, the reality is that Greece is already experiencing a full-blown economic depression. In Greece, 20 percent of all retail stores have already shut down. The unemployment rate for those under the age of 24 is now at 39 percent. Large numbers of Greeks are trying to get themselves and their money out of the country while they still can.
Pessimism regarding Greece is at an all-time high. Michael Fuchs, the deputy leader of Angela Merkel's political party, recently made the following statement.... "I don't think that Greece, in its current condition, can be saved."
In Greece we learn that, “Children are being abandoned on Greece's streets by their poverty-stricken families who cannot afford to look after them anymore. Youngsters are being dumped by their parents who are struggling to make ends meet in what is fast becoming the most tragic human consequence of the Euro crisis.”
Italy has a much larger economy, and if Italy totally collapses it will be an absolute nightmare for the entire globe.
Right now, the Bank of Italy is forecasting a significant recession for the Italian economy in 2012. The following is from a statement that Bank of Italy has just released.... "The uncertainty that surrounds the medium-term perspectives of the Italian economy ... are extraordinarily high and are directly linked to the evolution of the euro zone debt crisis".
Italy's youth unemployment rate is at the highest level ever, and nearly all sectors of the Italian economy are showing signs of slowing down.
Plus there is the problem of Italian debt. When, you add the maturing debt that the Italian government must roll over in 2012 to their projected budget deficit, it comes to 23.1 percent of Italy's GDP.
The economic problems have spread to a number of other European countries. Much of Europe is in the grip of an economic depression.
Spain, Portugal, Ireland are in depression and in Eastern Europe countries like Hungry, Romania, and Bulgaria are in the grip of depression.
The troubling news out of Europe just seems to keep coming in waves. Here are some more recent examples....
• Manufacturing activity in the euro zone has fallen for five months in a row.
• Germany's economy actually contracted during the 4th quarter of 2011.
• It is being reported that the Spanish economy contracted during the 4th quarter of 2011.
Bad loans in Spain recently hit a 17-year high and the unemployment rate is at a 15-year high.
So will all of this economic trouble eventually spread to the United States? The answer is yes.
The global economy is more interconnected today than ever. Back in 2008 the financial crisis that started on Wall Street ended up devastating economies all over the planet. The same thing will happen during this next great financial crisis.
Only this time the U.S. is in a much weaker position. The U.S. debt problem has gotten much worse since the last crisis. During 2008, the national debt crossed the 10 trillion dollar mark. Less than 4 years later, it has crossed the 15 trillion dollar mark.
Nearly half of all Americans live in a household that receives some form of financial benefits from the U.S. government.
We are headed full speed to a catastrophic financial disaster, the signs are everywhere but eyes are closed to the danger. We believe that this coming economic crisis will be used as a tool to bring about the infrastructure of a one world economic system, a one world monetary system, and a world government that will eventually follow it.
This whole monetary and economic crisis is pressing in on the world, and will, it seems, unfold in the near future.
Everywhere we look we see crisis situations that are coming to a head. Whether in America, Europe, Syria, Egypt, the West Bank, Iran, or Israel, the end time scenarios are coming to a climax.
The coming of the Lord is drawing nigh!