Saturday, February 7, 2009
by Stephen Lendman
Global Research, February 7, 2009
"...."Politics will make matters worse" because governments are "intervening in their economies more broadly and deeply than at any time" since WW II. Stimulus packages contain subsidies, protections, and new rules and regulations that pose dangers for global markets ahead. Coordinated policy isn't happening, and local politics pose "the biggest risk" going forward. It's as true in America and the EU as in China, Russia, India, Brazil, and emerging economies. Add militancy to the mix and instability increases. Sum it up: "The world's first global recession is just getting started," and who can know where it ends or how hard its impact before it does.
Six months ago, Roubini rated "depression" chances at 10%. Given policy blunders to date, he now says it's one-third. "The time to stop dithering is well past; and the time to implement a program of forceful, coherent, credible, globally-coordinated monetary, fiscal, financial clean-up and debt-resolution is now. The US and global economy are truly risking a near-depression if the policy reaction is not bold, aggressive, sustainable and credible." Barely a whiff of it in sight so far. Buckle up. The year ahead will be convulsive."