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What's causing the current global financial crisis? How bad do you think it is going to get and which countries do you think are in for a really rough ride?


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Q1. Greed and unrealistic market expectations. Once up on a time it was good enough for a company to remain profitable and to produce good products or services. Then came the age of year on year massive growth and exponential profit expectations. It was not longer good enough for a company to be stable, it had to have year on year double digit profits or the market would write them off as a bad company. This was driven by greed and not by common sense or reality.

Q2. How bad? I have been concerned by the prospect of a global depression since 2008. I don't think we are out of the woods here. A global depression this time may last a very long time. The last time gave rise to fascism in Europe and laid foundations for WWII. With growing anti-immigration in the US and anti-multiculturalism in Europe, I can't help but wonder if we are about to relive the 1930's. I hope I am very wrong here. But sadly the indications are pretty clear that we are in danger or repeating history.

Hope rests in more rational minds working to reinvent how we see markets, how we deal with debt. It also rests in the support and growth of micro-economic circles and local economies.

Q3. What countries. The entire world. The west will feel it in the shift in lifestyle, growing unemployment and greater drop in the middle classes. The rest of the world will feel it in hunger and possibly conflict.

But let's hope for the best.

5 ( +6 / -1 )

What crisis? We saw a stock market correction last week. It remains to be seen if it is a crisis.

2 ( +2 / -0 )

Can go very bad. Meeting with other unexpected factors can lead to war. Can be anything, even a grater scale of natural disaster, a plague or anything.

I believe it is caused mostly by unlimited human greed. The 90% of the world's wealth is in the hand 1% of the world's population, more exactly the 73 % of the world's wealth is owned by 367 people.

Bigger problem they can't use and circulate it properly, just sitting on it.

And yes, it might as well be the precursor of the Malthusian nightmare. I mean, I don't think the real answer lies just in the economy.

2 ( +2 / -0 )

The fact that our whole financial system and debt spiral was based on the assumption of constant economic growth. The world is not an ever expanding bubble and resources are finite so that put limits on growth.

Especially for some wealthy, developed countries, the realisation that there may be no growth left and we're in serious trouble paying what we owe. That requires adjustments, which might be painful for those of us who are used to more.

What really worries me is that this is not a crisis or a great recession, but the new normal.

2 ( +2 / -0 )

3 questions? A.1 World's number No.1 and No.2 economies. A.2 very bad A.3 All except emerging markets.

0 ( +0 / -0 )

Just watch the documentary 'Inside Job'. There's your answer.

0 ( +2 / -2 )

All the fiat currencies are being devalued together in mass by the globalists (gold/silver up). =Things are costing more.

If you salary is stagnant and your costs are going up you are feeling the pinch. -Same for businesses.

Good time to be a farmer or grow your own. Lots of good deals when people are forced to sell. Buy local and keep your local economy moving.

I went all-in on physical silver. Still keep some fiat currency, but only enough for a month or two. Stocked up on commodities like food. Cut back on using gas and will bike/walk more. Looking very intently on upgrading my Mountain bikes (old USA GT Zaskar/Xizang) and stocking old parts.

0 ( +1 / -1 )

the cause of current financial crisis is too much debt. incurring more debt to stimulate the economy is exactly the wrong thing to do as its just kick the can down the road and drags on future growth. japan has been doing it for years and it hasn't helped.

as for how bad it gets, its anyones guess, depends on a lot of things. if there is no immediate crisis, there is a possibility of a muddle thru period of low growth, high unemployment and inflation but if there is a substantial collapse or default like of one of the PIIGS, all bets are off.

as for what countries are in for a rough ride, all developed countries with substantilal debt are in for a rough ride, japan, europe, u.s.,. the balancing factor is how much natural resources the country has. a more or less self sufficient country can default on its debt to other countries and still have everything it needs to survive. in that respect u.s., australia, brazil should be ok. china will have a problem as it doesn't have enough food.

0 ( +0 / -0 )

Before economy experts wake up let me correct and say A.1 : World's No1 and No. 3 economies.

-1 ( +0 / -1 )

What crisis? We saw a stock market correction last week. It remains to be seen if it is a crisis.

There is a crisis all right. It began in the summer of 2007 and we are still in it. The stock market movements are nothing more than another delayed reaction. In recent months, the crisis has just moved from one phase to another - from heavily indebted European nations to the biggest of them all - the USA. A few weeks ago no one would have even questioned the USA losing its AAA rating and this weekend it has. Heaven knows how the markets will react on Monday.

The emerging markets are also under threat. China has boomed mainly through supplying the West with consumer, who had been on a shopping spree funded with borrowed money. Who was lending America all the money to buy so much Chinese-made produce? China, of course!

Japan may appear a little isolated, it is being punished through an over-valued yen.

-1 ( +1 / -2 )

The cause is as tkoind2 posted, "Greed and unrealistic market expectations", this was fueled by the excessive amount of money poured in by US/British Financial institutions incorporating the US Federal Reserve Bank. These institutions obtains vast amount of cash flow through transaction of natural resources done by US dollar. What they do is revert the cash flow into investments of their own with potential gain in short term transaction creating an eddy within the actual global transaction so to gain profit for themselves without disrupting main flow of global transaction. The problem we face right now is that the eddy had become too big disrupting the entire global economy including index of natural resources.

This is what fuels the US economy and why the US government was able to continuously grow their federal debt. The situation had changed when Iraq started negotiations with France wanting to include the Euro as their transaction currency for oil which led to the second Iraq war. After that Iran had developed their own oil transaction market incorporating Euro and Yen as transaction currency this in return heightened tension between US and Iran. The latest in the pulling away from the dollar is Russia also developing an oil transaction market incorporating Euro as well. These chains of events parting the US dollar as transaction currency have been hitting the US financial institutes now needing higher profits to maintain the eddy without disrupting the shrinking cash flow resorted to higher risk investments and/or worse artificially made profits. This had also signaled a response from the US federal government which led to the most recent event. From here we will probable witness an exit strategy by the US military as the world marshal with OPEC incorporating Euro as a transaction currency curtaining the US as global super power.

-2 ( +0 / -2 )

This is all being engineered by those running the show. This is a means to an end. We can look forward to Great Depression 2.0 followed by another major World War (WW3, if you will) and finally an ushering in of a new fascist era globally. Does it sound impossible? Perhaps but let's watch as it all unfolds according to plan before us. Grab yourselves a big tub of popcorn to enjoy the show. It is not going to be pretty.

-2 ( +0 / -2 )

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