[CAMWEST-discuss] (no subject)

Danny Hannan danny_hannan at yahoo.com
Mon Feb 8 23:16:56 UTC 2010


G'day all,
If you are thinking:  Where is the economic recovery?  Here are some numbers that show why it will be a long time coming and that there are more risks to the down side than there are the points for the up side.

"While the Congressional Budget Office expects America’s debt to reach 65 percent of GDP in 2010, that would still be below the 77 percent of GDP the European Commission expects for Germany, the U.K.’s 80 percent and Japan’s 180 percent." Feb. 8 (Bloomberg)
http://www.bloomberg.com/apps/news?pid=20601083&sid=aVbhDaStbA1Q
 
Germany is one of the best off countries in the EU.  Several of the EU countries are as bad off or worse than Japan.  Greece, Portugal, Spain, Ireland, Italy to name the worst.  And this is only the sovereign government debt and makes no allowance for the personal, corporate or regional/state government debts in these countries that are often also very high.  These other debts can cause financial storms if not serviced as did the sub-prime mortgage crisis in the USA.
 
With the USA, the UK, the EU and Japan we have some two thirds of the global economy, and the major consuming markets.  Where the Asian economies export their goods to be sold.  With major markets needing to tighten monetary policy to meet debt obligations can China, India etc continue to grow economically without increasing exports?  I doubt it.
 
Add to this situation that energy prices are rising due to demand/supply balance and the increasing expense of combating Global Warming and you can see the reasons for my pessimism.  Several estimates that also align with my research indicate that we can expect US$100-150/barrel for oil in 2012, a price that will again cause economic recession. 
 
While Australia is some what insulated because of our commodities export to Asia, we are not immune.
 
Dan
 danny_hannan at yahoo.com 


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