I agree with jeanne 100%. The economic crisis is the result of collapse of the whole system. The economic crisis will come as a result of unstable world politics(I've mentioned about cold war/trade war between USA and China in 2018, probably russia will be involved somehow ?). Next two years will determine the course of next two decades. Personally, I think the arrow has already left the bow of destruction.
Asian, agree. but when the arrow leaves the bow, it is blown by the wind. It does not always land where it was intended to. The winds blow where they will, not where we want them to.
Zoron agree about wind blowing where it wants to part. But, it started blowing about a decade back and only pick up speed from here. I think those who wants to shoot the arrow do not realize that the wind is blowing in reverse direction, it will only come back towards them.
I've decided to bump this thread because of some news coming out of the financial world. Last week the yield curve on US Treasury bonds inverted, and yield inversion has occurred roughly a year before every one of the last seven US recessions. For more about yield curves and what they could portend, this articles from the New Statesman is a good place to go.
I'm not a keen market watcher. It's just that this chatter about yield curves is another real world indicator pointing to a major economic downturn beginning late this year or in 2020 (as Jeanne has predicted). An economic meltdown would have uncomfortable ramifications for the White House and an administration that has staked so much of its legitimacy on soaring stock markets. As a front page headline in today's New York Times states, "Data Challenges Trump Optimism On The Economy. Experts See Slowdown: Taking Ownership of a Boom, and Risking Blame for a Bust."
The 10 year vs 2 year curve hasn't inverted (yet), but is still very close (0.14% difference as of 28-March-2019). A year ago, it was 0.47% difference. It has been as low as 0.13% in the past few months (range has been 0.13% - 0.21%.
I read somewhere that the global economy is based on growth and behaves like a drug addict. Each economy demands more, more, more. The USA is the biggest consumer, trash producer, and second hand polluter. Growth is considered so pleasurable and the desires for goods, services, and petroleum are insatiable. The only problem here is there is a finite amount of resources, and in order to maintain balance and health, we must nourish each other and the environment in which we live to sustain us.
We may be at a tipping point we think, but it never seems to come. The economy is one function of this over-consumption. It may be good overall to slow 'growth', but will we ever learn to take care of each other?
What you read is correct, FirstCat. Our current growth-based global economy got its start with the European age of exploration, when raw materials were growing scarce in Europe, thus pushing Spain, France, Great Britain, and the like to establish colonies overseas. Now, 500 years later, international free trade agreements and bodies like the IMF, World Bank, and WTO are continuing that extractive pattern of sating the Global North's appetite.
As you said, resources are finite. The major dealbreaker is that the hydrocarbon energy reserves that power the vast majority of our economy (coal, petroleum, natural gas), are also finite, and they're getting harder and more expensive to extract every year. There is a large body of literature out there about how increasingly expensive energy will bring about the end of our paradigm of endless growth, and how the 2008 financial crisis was just a preview of what's to come. (I recommend browsing Tim Morgan's Surplus Energy Economics site to learn more. The Club of Rome's landmark "Limits to Growth" report from 1972 might also be of interest.)
But Jeanne's visions and those of others posted on this site indicate that we really will be moving away from our growth obsession in the years to come. There are lots of collective enterprises and intentional communities that are already enacting that transition. So hang in there. As Arundhati Roy writes, "Another world is not only possible. She is on her way. On a quiet day, I can hear her breathing."
My dear FirstCat & Coyote... Thank you! for these posts...
It is going to be a long walk back to the Garden.
With the outrageous corporate take over in the US of our wild lands (unique in the world) and the unprecedented push for more & more oil, mining, drilling, cattle production leases and sellouts to satisfy the greed of an overly corrupt 'economy' globally, it is truly a tipping point that is already here.
"But will we ever learn to take care of each other?"
Ahhh.... sigh.
This may not seem relative to the 'economy' technically, but perhaps it will be a source of light in the 'bigger' picture? The documentary 'Our Planet' airs tomorrow for the first time (Netflix) and is produced by the World Wildlife Federation... this is a docuseries that will address the many layers of what is going on right now with the world we have.......
I hope that we can all see it ❤️
I feel that with the latest round of firings and crazy ideas that Trump is insistent upon executing... there will be some blowback from Republican senators and they will break ranks. Also, some of the things he will do and have done will begin to cause some unraveling in the economy this summer and we will see recession. Trump will blame the Fed for not cutting rates even more but they really cannot cut much more than they already have. We are seeing the WH unraveling right now. Even with the Republicans constantly covering up for him and protecting him, he can't get out of his own way and will blow it all up. He does not want to listen to anyone anymore.
Following the release of the commerce department's better-than-expected quarterly report two weeks ago, economists were proclaiming in the New York Times that "The economy is back!" and that "We won't have a recession this year." Now here we are, and in the course of three days, the president has double down on raising tariffs on Chinese products; Iran is threatening noncompliance with the 2015 nuclear deal; and stocks have tumbled (again). One lesson we can take away from all of this is that traditional economists are extremely myopic, and that the world is not as neat and tidy as the lecture halls of Harvard would have them believe (particularly in the age of Trump).
But for all the talk about the economic damage being inflicted by our manic depressive in chief, it helps to keep in mind the innate structural problems that afflict the entire global economy, and that we are due for a calamitous economic crisis regardless of who happens to occupy the Oval Office. Charles Eisenstein sums up our predicament as a society in his essay "Money and the Crisis of Civilization":
"For the economy to continue growing and for the (interest-based) money system to remain viable, more and more of nature and human relationship must be monetized. For example, thirty years ago most meals were prepared at home; today some two-thirds are prepared outside, in restaurants or supermarket delis. A once unpaid function, cooking, has become a “service”. And we are the richer for it. Right?
'The crisis we are facing today arises from the fact there there is almost no more social, cultural, natural, and spiritual capital left to convert into money. Centuries, millennia of near-continuous money creation has left us so destitute that we have nothing left to sell. Our forests are damaged beyond repair, our soil depleted and washed into the sea, our fisheries fished out, the rejuvenating capacity of the earth to recycle our waste saturated...The larger economic system, based as it is on the eternal conversion of a finite commonwealth into money, is unsustainable as well. It is like a bonfire that must burn higher and higher, to the exhaustion of all available fuel...The present [post-2008] crisis is actually the final stage of what began in the 1930s. Successive solutions to the fundamental problem of keeping pace with money that expands with the rate of interest have been applied, and exhausted. The first effective solution was war, a state which has been permanent since 1940...Other solutions — globalization, technology-enabled development of new goods and services to replace human functions never before commoditized, and technology-enabled plunder of natural resources once off limits, and finally financial auto-cannibalism — have similarly run their course. Unless there are realms of wealth I have not considered, and new depths of poverty, misery, and alienation to which we might plunge, the inevitable cannot be delayed much longer."
Excuse the long quotations, but the point I'm trying to make is that these present economic jitters are actually symptomatic of a centuries-deep malaise, and that even a hypothetical President Warren or Sanders wouldn't be able to swoop in to the rescue.
Looked at from a different angle, though, the end of our economic paradigm is actually exciting, since the destruction of the old ways allows each of us as individuals to become potent change agents. Economic salvation will not come from a unicorn presidential candidate. Rather, the new era will be midwifed into being by common people like us, exchanging ideas and sharing our lived experiences.
You might be wondering what this means for your individual finances. Mortgages? Retirement savings? Student loans? I'm not a financial advisor, but as we progress further into uncharted economic territory, your own intuition about what's in your best interests is probably more reliable than missives coming from America's VSPs on high.