World economic growth is set to fall to just 0.5% this year, its lowest rate since World War II, warns the International Monetary Fund (IMF). BBC NewsDavid Seaton's News Links
The most singular feature of the present recession is that it is universal... the entire world is experiencing recession simultaneously.
The crisis has its origins in America's surreal real estate bubble and Wall Street's shenanigans and most informed observers, seeing it coming, expected the world to decouple and continue to grow, thus quickly pulling the US out of the slump. But since globalization is basically the invention of American multinationals, and the dollar, although a fiat currency, is the universal store of value and trading tool, the world could not decouple. That means that the United States has pulled the whole world down into what could be an epoch making catastrophe.
It appears that very few people have understood the full portent of that. As Maureen Dowd puts it:
The former masters of the universe don’t seem to fully comprehend that their universe has crumbled and, thanks to them, so has ours. Real people are losing real jobs at Caterpillar, Home Depot and Sprint Nextel; these and other companies announced on Monday that they would cut more than 75,000 jobs in the U.S. and around the world, as consumer confidence and home prices swan-dived.The world could not decouple and they probably had never seriously thought about having to decouple before and perhaps the most important thing is that today they are thinking about it. "Gee wouldn't it be nice not to be dragged down into the pit by what appears to be mass American criminality, institutionally aided and abetted".
That a recession that may destroy the prosperity of hundreds of millions, perhaps billions of people, all over the world, has been brought on by frivolous larceny is hard to forgive and harder to forget.
Now, at this very moment, a lot of very intelligent people, all over the world, are rolling the idea of decoupling around in their minds -- disaster often makes people creative -- and before too long somebody will come up with something. They will not want to go down this path ever again.
Except for some movie stars, divorce is not something that happens from one day to the next. Most people suffer quite a lot before breaking a home, and even when the decision is taken, it is rarely simultaneous and one of the couple about to decouple (the one about to be left) is usually surprised and often in denial. I think that is the case of American policy makers right now.
The phrase, "We are ready to lead!", sounds a lot to me like, "honey, we can work this out". DS