Nick Garlaounis 1The Recession The World Has to Have!
October 16th 2008 01:10
It's finally here, the recession the world had to have is now looming and I believe has acutally begun. No matter what the world leaders are saying or doing the recession is biting down on world economies and will take hold as we move forward.
Even the US move to sure up the banking system will do little to stem the tide of growing bad debt and share market losses. This IS a recession we have to have! Although it's nice to think that we can minimise the impact and that we were never going into a recession the reality is that it is long overdue.
The reason for this is that the financial cycles have gone on for far too long, for example the real estate market went into an 11 year boom period as did the share market where the standard cycle for growth is approximately 7 years.
What this does is falsely inflate the value of property and shares, the issue now is that both of these key markets have declined at the same time so in essence it is a doubel whammy effect on the global economy. Normally the downturns are inversely related so this is a real dramatic turn of events.
How long will it take to get through this recession? In my opinion it will take about 3 years before we see the light or day, in the time what the world will experience is a higher level of unemployment, increased crime statistics, higher levels of poverty and many companies closing their doors.
Even the rising economies of China and India will be impacted greatly as consumer spending will reduce dramatically so in turn the export from these two countries will lessen and so will their overall economic stability.
The recession is finally here and yes it is a recession the world has to have.....
Even the US move to sure up the banking system will do little to stem the tide of growing bad debt and share market losses. This IS a recession we have to have! Although it's nice to think that we can minimise the impact and that we were never going into a recession the reality is that it is long overdue.
The reason for this is that the financial cycles have gone on for far too long, for example the real estate market went into an 11 year boom period as did the share market where the standard cycle for growth is approximately 7 years.
What this does is falsely inflate the value of property and shares, the issue now is that both of these key markets have declined at the same time so in essence it is a doubel whammy effect on the global economy. Normally the downturns are inversely related so this is a real dramatic turn of events.
How long will it take to get through this recession? In my opinion it will take about 3 years before we see the light or day, in the time what the world will experience is a higher level of unemployment, increased crime statistics, higher levels of poverty and many companies closing their doors.
Even the rising economies of China and India will be impacted greatly as consumer spending will reduce dramatically so in turn the export from these two countries will lessen and so will their overall economic stability.
The recession is finally here and yes it is a recession the world has to have.....
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