Even as some insist that the global economy is in “secular stagnation,” the facts suggest that we may be entering the “worst” depression in history. The global markets have been on a slippery slope since the summer of 2007, and things have only been getting worse in 2016. The picture looks dismal, no matter which theoretical lens one uses. (This article was written on 5 February before last week’s tumble in global and Indian markets.)
(i) Rumours that the Italian banking system might collapse.
(ii) Rumours that Deutsche Bank could become the next Lehman Brothers.
(iii) Chinese economy is facing a mountain of bad loans that could exceed $5 trillion.
(iv) The negative interest rate programme in Japan.
(v) The 10 Year US Treasury Rate is going below 1.80%, and moving up and down wildly.
(vi) Oil price has gone below $30 per barrel, and has moved up and down wildly.
(vii) Gold price has gone above $1,155 per troy ounce, and has moved up and down wildly.
(viii) The Baltic Dry Index, a measure of the health of world trade, crashed below 300 for the first time in its entire history.