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KSa · Langcaffeine Addict Joined: 27 Aug 2006 Posts: 601

What is happening on the stock markets looks rather scary...
What do you think about the future of the global economy?
I'm not optimistic.

greg in noord-frankrijk · Posted: Tue Jan 22, 2008 4:40 pm Post subject:

I don't know what to think about that (so far) minikrach. All I learnt is that 200 billion euros have been volatilising during the last few days and that the bill has not been entirely footed yet as panic may prove an excellent fuel for further financial damage. It seems to be a credit crisis : banks have been reluctant to manage actual credit risk ; they thought they could quarantine loan risks and treat them like vulgar PC viruses in stand-by — using sophisticated financial antivirus software → securitisation and escape-lane bubbles —, but when you lend to poor people (as was the case with subprimes) credit risk remains high no matter how deep you're digging sand to bury your own (and others') head in. The subprime story seems to be working as a kind of massive, compulsory provision for neglected (albeit certain as soon as inception) losses : a readjustment. The only problem is that a posteriori adaptation is seldom as good an experience as calm anticipation. Basically all that seems to be the hard landing that the economic literature has been heralding for at least 6 or 7 years (un grand merci à Bush et ses conneries monumentales !).

Now all the countries (USA, UK etc) where households haven't been able to save a penny due to excessive indebtness will soon be likely to be hurt badly as domestic demand was exactly what has fueled their economic growths. Financial centres that typically rely on financial bubbles are in great danger of falling into mayhem. But time will tell... How will the stock-exchange crisis propagate to real economies (I mean the ones properly managed or close to) ? I don't know. I hope the Eurozone will be strong enough. Lagarde, our finance minister, claims there is no krach in Europe. But denial is part of the job of a finance minister, isn't it ?

Benjamin [inactive] · Posted: Sun Jan 27, 2008 10:56 pm Post subject:

In a way, I'm secretly hoping for an economic crisis in this country. It could certainly be used as an opportunity to try and bring about substantial change to the system.

However, I don't view 'economic growth' as inherently valuable anyway. Less material wealth might prompt us to consume less, thereby resulting in less environmental damage.

KSa · Langcaffeine Addict Joined: 27 Aug 2006 Posts: 601

Elaine · Posted: Thu Dec 04, 2008 8:36 pm Post subject:

No question about it. We are definitely in a recession. The US government even said so.

And this just in (12/4/08)...

Elaine · Posted: Fri Dec 05, 2008 6:01 pm Post subject:

Employers cut 533K jobs in Nov., most in 34 years

Loic · Posted: Sat Dec 06, 2008 8:28 am Post subject:

Elaine, you work in the financial industry, don't you? Are employers becoming more tightfisted at this time of the year by for example, reducing or getting rid of the variable wage component altogether such as year end bonuses?

In a way, a perverse side of me is quite glad that the world is entering a recession. Life has been too predictably staid for the past 5 years; growth after growth built on the back of what Keynes would call "animal spirits" or Greenspan term "irrational exuberence" gets a little dull after awhile, doesn't it?
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Elaine · Posted: Wed Dec 10, 2008 6:39 pm Post subject:

André in Zuid-Afrika · Site Admin Joined: 19 Aug 2006 Posts: 1908

A lot of people are losing their jobs here as well. In the company I work for, there have been huge staff cuts. Luckily, at my newspaper staff have already been cut to the bone, so we didn't suffer much.
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Elaine · Posted: Fri Dec 12, 2008 2:07 am Post subject:

And the axe continues to fall on American workers...

André in Zuid-Afrika · Site Admin Joined: 19 Aug 2006 Posts: 1908

Jeez, things seem to be a lot worse in the US than here.

We've had staff cuts too, but no where near as bad as this!
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Patrix · Expert Joined: 15 Sep 2006 Posts: 52 Location: China

Here in my country things are no better. As an economy heavily reliant on overseas demand, the coastal areas of China have been witnessing unemployment for quite some time. Prices of commodities and profits of companies have been falling appallingly. I saw in the news today that SASACSC (Stated-owned Assets Supervision and Administration Commission of the State Coucil, so damned long

), the deputy shareholder of China's largest state-owned corporations, who holds shares on behalf of the government, ordered its subordinate companies to refrain from laying off workers but allowed them to cut salary. Wuhan Steel cut the salary of middle-and-above-leveled management by half. Numerous companies have suspended their investment plans (another heavy blow on economic growth), forcing the government into releasing a 600 billion dollar fiscal stimulus package. Chinese central bank--People's Bank of China has also made an effort to stimulate investment and reduce savings by axing interest rate by 108 basis points at a go, but in time of recession or depression the effects of monetary policies always prove to be little.

I personally think this recession will last for a long time, probably longer than the prediction of most people, and have its potential to develop into a depression, because asset prices keep falling, but the value of debts does not fall with it. Thus there will be a double effect in cutting private sector investments. Hope lies in government fiscal stimuli. (Well done Obama!

)Be prepared for hardships, folks!

Elaine · Posted: Mon Jan 26, 2009 8:25 pm Post subject:

Yikes! It just keeps getting worse:

Elaine · Posted: Fri Mar 06, 2009 10:08 pm Post subject:

This country's going down in flames...

greg in noord-frankrijk · Posted: Sun Jun 07, 2009 11:43 pm Post subject:

Hi everybody ! Anybody out there ?!

Elaine · Posted: Wed Jun 10, 2009 7:32 pm Post subject:

KSa · Langcaffeine Addict Joined: 27 Aug 2006 Posts: 601

Patrix · Expert Joined: 15 Sep 2006 Posts: 52 Location: China

Yes! It's definitely time to revive langcafe. Terminate your hybernation, get out of your dens, polar bears, congratulations, you have survived the financial crisis.

PS: do bears hybernate in dens?

KSa · Langcaffeine Addict Joined: 27 Aug 2006 Posts: 601

I totally agree - I can sense the end of the crisis. Of course the repercussions will be perceptible for some time but still there is some light visible at the end of the tunnel. It's highest time we woke up from our letargy as well and stoped behaving like the world economy.

Yes, I think bears hibernate in dens.

greg in noord-frankrijk · Posted: Tue Aug 25, 2009 12:23 am Post subject: