Mish has the details and a roundup of really, really lousy economic headlines.
My take: if the employment report comes in better than expected tomorrow, then the sheep who run our financial system will some how, some way, hold it to be evidence that things aren’t as bad as they look…the market might surge by hundreds of points. On the other hand, if it comes in worse than expected, then watch out.
The bottom line for the global economy is, as it has been for years, that there is way too much debt. Each and every nation – yes, including China – is honeycombed with bad debt which cannot be repaid…in some cases never, in other cases just not in the contractual time frame. We borrowed ourselves in to a global boom and now the piper has to be paid. We might dodge this one more time but no matter how many times we pull back from the cliff, we are still ultimately heading for a crash. Default is the only way out for some nations, while a quasi-default will be required of all other nations.
The lesson to be learned is that debt is poison…we’ve been hoodwinked; suckered by a classic, get-rich-quick ponzi scheme which held that we could borrow forever, live like kings and never have to repay. Don’t get me wrong, here – we, the people, for the most part eagerly joined in the scam. We lost our heads – and, more importantly, we lost our sense of moral rightness. Once we pay this price, it is to be hoped that we’ll take our lesson to heart and build an economy based on hard work, savings and careful investment.
more marxist/kenyan….er Keynesian economics.