It's recession time!

[willy88]

http://afp.google.com/article/ALeqM5i-ZDQdISbRQMV7Wiz4IDYNviiDKQ

This will correspond nicely with peak oil. hthedrama:

 

[James.Denholm]

Coincides nicely with my release of the Zombie Virus.

 

[jedidia]

I try to look at the bright side...

If there comes a serious crash at the stockmarket and U.S. economy (and european with it) goes bye-bye, at least switzerland can claim having had a hand in bringing down the worlds mightiest nation. Or one of our banks anyways. :dry:

Fun aside, I don't think it's time yet for the end of the world as we know it. I think the shift of economic power to the other side of the globe is not due for another... hmmm... at least 6 years. But I'm not an expert at all when it comes to economics, so I wouldn't wonder when I'm mistaken.

 

[Native Son]

It's recession time!

It's about bloody time!

 

[ryan]

It's about bloody time!

Language please Native.

 

[ar81]

I try to look at the bright side...

If there comes a serious crash at the stockmarket and U.S. economy (and european with it) goes bye-bye, at least switzerland can claim having had a hand in bringing down the worlds mightiest nation. Or one of our banks anyways. :dry:

Fun aside, I don't think it's time yet for the end of the world as we know it. I think the shift of economic power to the other side of the globe is not due for another... hmmm... at least 6 years. But I'm not an expert at all when it comes to economics, so I wouldn't wonder when I'm mistaken.

I do not think Europe will have a crash.
The problem of inflation in Europe is caused by excess of liquidity caused by the leak of currency that is taking place in USA. As currency goes out from USA due to the several sources of deficit, it inflates economies of other countries.

The solution is to invest that money in poor and foreign countries and raise employment in poor countries. Why should you do that? Because poor people are cheaper than european workers and in a globalized world such a pricing gap of workers is likely to send jobs to poor countries. So reducing poverty is a key if european citizens are going to keep their jobs.

European citizens keeping their jobs is a key not to have Europe entering recession, for citizens are customers, and if citizens do not lose their jobs, US crisis would be as harmless as a crisis of penguins on Mars.

 

[jedidia]

If Wallstreet crashes, europe goes down with it. The economies are too closely linked. The inflation of the dollar brought allready some minor problems, because It means America goes back on european imports. And europe currently doesn't have much other partners to export to (I'm talking big style here, not the occasional buisness).

Americans don't buy european stuff anymore means europe going into recesion. Hence, American recession = european recession. At least if I didn't miss some major developements in the last few years (which is possible, since I spent them in Bosnia, where news of the worlds economy have a tough time reaching you if you don't actively search for them. Which I didn't).

 

[GregBurch]

European citizens keeping their jobs is a key not to have Europe entering recession, for citizens are customers, and if citizens do not lose their jobs, US crisis would be as harmless as a crisis of penguins on Mars.

Congratulations. You have one element of Keynes figured out. But thinking you can prescribe solutions for global economic issues based on that one idea is like thinking you've got all of physics figured out if you understand Kepler's laws ....

 

[Urwumpe]

Europe is on the same planet as the USA - a recession in the USA would not make a turn around Europe.

BUT! Europe is no single country or a monolithic economy. During the last European economic crisis, you still had countries having 5%+ growth rates.

of course the majority of Europe will share the recession. But it will this time likely hit Europe less hard as in other times - the cause of the recession is a 90% pure US problem, which does not have similar causes outside the USA. It is based on the special aspects of the US loan economy, and only few banks in Europe are directly affected.

So, the biggest problem for Europe will be a drop in US imports. Which will be painful. But we will not have a massive bubble which will burst. We can use market instruments to mitigate the US recession. When prices for goods will inevitable drop, other markets will become interested.

EDIT: Also, before people forget it: It is the weak US-Dollar and the weak US economy, which makes sure that we can still afford our oil.

 

[eveningsky339]

http://afp.google.com/article/ALeqM5i-ZDQdISbRQMV7Wiz4IDYNviiDKQ

This will correspond nicely with peak oil. hthedrama:

Bah, these sorts of things have been happening ever since the days of Mercantilism and the exploration of the New World. We've been through worse. :beach:

Oh crap, did I just jinkx us all? I think I did...

 

[Spicer]

The peak price of oil, and the economic shift to China and much of Asia, is not at all unrelated.

15 years ago, Bill Clinton decided to keep China as our "Most Favored" trade partner. That kind of thing doesn't have an immediate economic effect, aside from having tons of inexpensive things floating around the US during the time that Clinton was president. That made him look great.

Now, China has benefited from an influx of American $$$$. Millions of Chinese are able to buy cars. That is one of the reasons that Oil is so expensive. Our economy is weakened now. That is one of the reasons that the American $ is less valuable.

Bill Clinton is the Antichrist. The terrible economy now is a result of his quest for popularity.

 

[n122vu]

The peak price of oil, and the economic shift to China and much of Asia, is not at all unrelated.

15 years ago, Bill Clinton decided to keep China as our "Most Favored" trade partner. That kind of thing doesn't have an immediate economic effect, aside from having tons of inexpensive things floating around the US during the time that Clinton was president. That made him look great.

Now, China has benefited from an influx of American $$$$. Millions of Chinese are able to buy cars. That is one of the reasons that Oil is so expensive. Our economy is weakened now. That is one of the reasons that the American $ is less valuable.

Bill Clinton is the Antichrist. The terrible economy now is a result of his quest for popularity.

Did a report on this back in high school, when Slick Willie was at his peak. Didn't think it would take this long for the effects to propogate though.

 

[Urwumpe]

Wouldn't it be more honest to be angry, that nobody forced you too buy cheap Chinese TV sets, cheap Chinese computers and cheap Chinese clothes...

Honestly - I think you have so much hatred of Bill Clinton, that you fail to realize, that other countries with major trade with China, like for example Germany and the rest of the Eurozone, have exactly the opposite trend in their currency. And our trade (EU vs USA) with China is nearly equal.

How can you explain this? Bill Clinton did not force us to buy Chinese products, too. The only difference is, our governments have far stricter budget rules, as the USA, to follow for taking part in the Eurozone. People trust the Euro to be stable.

"His quest for popularity..." is also the most stupid sentence of the day so far (and I include Yahoo! Answers). The difference between both Bush presidents and Clinton is very simple: Clinton had the USA make a profit and reduced the federal debts. Both Bush presidents left (and will leave, in the case of GWB) with enormous debts. And both accumulated the debts mostly by making tax presents or military adventures.

It's pretty much like what I said some years ago: The USA can't afford a republican president for long currently.

 

[jedidia]

Now, China has benefited from an influx of American $$$$. Millions of Chinese are able to buy cars. That is one of the reasons that Oil is so expensive. Our economy is weakened now. That is one of the reasons that the American $ is less valuable.

Sorry, this seems a bit contradicting, and it doesn't match with the (admittedly little) knowledge I gathered about the situation.

first, if Chinese could buy cars because of the low dollar, it would mean they're buying american cars, since these are the only ones that actually got cheaper by the failing dollar. But as you pointed out, chinese products are generally cheaper, and so are chinese cars. And they're still cheaper, even though american products went down a bit. Otherwise you'd find the chinese TV-set in your stores more expensive than your native one.

second, Chinese economy is practically running on dollars. Their own currency is not yet established enough to be a practical way for doing buisness. So the chinese actually lost a lot by the dropping dollar.

 

[Urwumpe]

second, Chinese economy is practically running on dollars. Their own currency is not yet established enough to be a practical way for doing buisness. So the chinese actually lost a lot by the dropping dollar.

The Chinese could profit from all goods, which are coupled to the dollar - oil and many other natural resources.

I think the trade with machinery also goes over the dollar.

Finally, the Chinese suffer slightly from the bad dollar, as they currently export more into the USA, as they import. (while it is slightly equal for the EU)