tag:blogger.com,1999:blog-3886214044927583593.post8652967725594813621..comments2023-09-06T13:56:44.951+00:00Comments on uptone: RECESSION Part IVjohnalexwoodhttp://www.blogger.com/profile/01643488607849736607noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-3886214044927583593.post-56059671206913878592009-03-27T00:45:00.000+00:002009-03-27T00:45:00.000+00:00If you mean, “Something has to be done to bring th...If you mean, “Something has to be done to bring the global standard of living and the economy back to what it was before the credit crunch”, as I see it there is nothing that can be done -- it won’t happen.<BR/><BR/>For the last 25 years or so the whole world has been living beyond its means. There is no way, no ‘fix’, no political magic wand, no possibility, that the past ‘cloud cuckoo land’ situation can be reinstated or continued. All the ‘Fiscal Stimuli’ and ’Quantitative Easing’ in the world can not redress the fundamental problem. We have an unsupportable level of global debt which will have to be worked down to a much lower and sustainable level, similar to the debt level of the 1970s.<BR/><BR/>I liken it to a family who has for years been living beyond its means. Each member has several credit and store cards which they have ‘maxed out’. They have bank loans. They have signed up to a mortgage to acquire a large property with repayment terms they can’t meet. Their combined debt mountain gradually becomes insupportable and, sooner or later, however much they wriggle, the bubble bursts. What to do? They have to drastically cut down on their living standards and work off their excess debts. For example, one car instead of two, two TVs instead of three, take cheaper package holidays (or stay at home!) instead of luxury cruises, no more ‘play stations’ or expensive toys for the kids, make their clothes last longer, don’t buy anything unless it is essential, ‘make do and mend’.<BR/><BR/>After paying off their debts, which could take years, they must live within their means. From then on, they can only have what they can pay for.<BR/><BR/>The worst depression in history? Probably, yes. That’s because we have just had the biggest fictitious wealth boom in history – a boom built, not on productivity and earnings. but on debt.<BR/><BR/><B>After reading this, I recommend you pour yourself another drink!</B>Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-3886214044927583593.post-40104222952639261032009-03-27T00:44:00.000+00:002009-03-27T00:44:00.000+00:00I definitely agree however I’m sure you will agree...I definitely agree however I’m sure you will agree that SOMETHING has to be done... we could be looking at the worst depression in history... so, what are the alternatives?Anonymousnoreply@blogger.com