Global economic party is over

The outlook for the global economy is rather gloomy. Global growth rates are declining, the United States and many EU countries suffer from an economic downturn, primarily caused by the U.S. subprime mortgage crisis and soaring commodity prices, most notably oil. Even China, a guarantor of double digit growth rates, is likely to cool down while dealing with the numerous threats to the country’s social and economic stability. (Read more on: Amazing opening ceremony of the 29th Olympic Games in Beijing)

The high oil price impacts airlines and container shipping companies all around the world. (Shrinking Asia -> Europe cargo volumes indicating an economic downturn in Europe) High inflation rates are destabilizing the global monetary system. In fact, two thirds of the earth’s population are facing double digit inflation rates. (Doubts whether the ECB’s interest rate increase can counteract inflation)

Hans-Werner Sinn, president of the Munich-based Ifo Institute for economic research summarized all factors impacting global growth in this worth reading article:

The global economic party has ended; The Japan Times


Check out: Wrong-Way Driver Germany



Filed under Economy

2 responses to “Global economic party is over

  1. Hi max
    amazing blog..check out Ravi Batra ‘The New Golden Age” it will give you even more insights into the global crisis that we are in and how it might resolve.


  2. economax

    Thanks mike!
    I’ll act on your advice and read “The New Golden Age”. Sounds really interesting.

    By the way, amazing hostel!


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