Given how incredibly difficult it was for Japan to stagger out of stagflation in the the 1990s/2000s - if they're even over it yet - how is the entire global system going to cope?
India's growth alone won't be enough to turn the tide; it's pretty obvious that China is not going to grow very quickly for the next decade or so; USA is caught in the trap with minimal growth; Brazil & Russia are undergoing severe contraction, along with all of the oil-producing nations. Aussie and Europe/UK are contracting so quickly Euro bank shares are down by 40% or more.
Many governments have interest rates at near zero.
Whence cometh growth?
Given the examples of Weimar and Zimbabwe, the massive QE by the reserves of US & Europe should have resulted in some serious inflation, but there isn't any. The reasons for that are bleeding obvious: houses and shares.
World shares have been savaged and property cannot continue forever, so with failing commodity prices, I can't see any reason for growth to happen. Infrastructure spending won't work (ask China) beyond a short-term solution, and most governments have infrastructured themselves out over the past decade in fruitless attempts to bolster economies.
I can't see a way out of the current situation and expect a prolonged period of low or negative inflation and nil wage growth.
India's growth alone won't be enough to turn the tide; it's pretty obvious that China is not going to grow very quickly for the next decade or so; USA is caught in the trap with minimal growth; Brazil & Russia are undergoing severe contraction, along with all of the oil-producing nations. Aussie and Europe/UK are contracting so quickly Euro bank shares are down by 40% or more.
Many governments have interest rates at near zero.
Whence cometh growth?
Given the examples of Weimar and Zimbabwe, the massive QE by the reserves of US & Europe should have resulted in some serious inflation, but there isn't any. The reasons for that are bleeding obvious: houses and shares.
World shares have been savaged and property cannot continue forever, so with failing commodity prices, I can't see any reason for growth to happen. Infrastructure spending won't work (ask China) beyond a short-term solution, and most governments have infrastructured themselves out over the past decade in fruitless attempts to bolster economies.
I can't see a way out of the current situation and expect a prolonged period of low or negative inflation and nil wage growth.
via International Skeptics Forum http://ift.tt/1Qk773n
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