The Global Depression Scenario

I’ve been way too busy with work, family, etc. to do much original thinking about current events, so I’m passing on interesting things I find on other blogs.  In that vein, here’s a short piece by John Robb of Global Guerillas discussing how the ‘global depression’ scenario is becoming the most likely one in his thinking/modelling.

For my part, I’ve been reading and watching what President Obama and his economic team are proposing to do, and it seems very similar to what the last regime did.   Keeping the global money game going by sticking it to taxpayers does little to reduce the mountain of debt we are accumulating… all it does is shift the burden away from the bastards that did much to facilitate this crisis in the first place.    I’m starting to believe more in the line of thinking that the US may be screwed, but the rest of the world will be screwed even more than we are.   There aren’t enough euros, pounds, yuan, gold, or any other financial instrument in the world to soak up all of the trillions of dollars floating around out there.

How this all will shake out is beyond me, but eventually there will have to be a global reset of one sort or another.  Until that happens, it’ll be Groundhog Day redux… another month or two passes, and another round of bailouts is proposed… rinse and repeat.

2 Responses to The Global Depression Scenario

  1. Rebecca says:

    Over at The Automatic Earth, ilargi says the total amount of troubled derivatives at just the three largest banks is $730 trillion. If that’s the case, nothing can be down to save them. They are toast, no matter how much grease we shove at them.

    As for Obama, I’m having a real “meet the new boss…same as the old boss” feeling right now.

  2. Bart says:

    The problem with the derivatives is that the holders of those instruments are scared shitless about the prospects of the true amount of derivative dollars being revealed to the public, and how little they are worth now compared to the amount of debt attached to them. Until this happens, of course, nothing will truly be solved, so we continue to kick the can down the line.

    Obama’s no economist, so I’m sure he was told that his current financial brain trust are “the best & brightest” he’s got to work with. If there is any real change to happen, it won’t until the new geniuses fail and simply make the situation even worse. The test of Obama’s mettle will be in his willingness to go in a different direction when his current crew fails.

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