Credit Crisis Gets Shorter But Consequences Increase
Suppose that printing money will save the financial system from crash. Level of indebtedness remains high, consumption may not be reanimated and the inflation is at the starting line. In a good case, the global economy may have the route of Japanese economy after 1990. In bad, we expect a new crisis, faster than you think. In which case, would be nice to ensure independent with energy and food.
For 80 years, the economy grew stunning planet. An increase has been made especially on credit; consumption is boosted by more generations born after 1950 who supplied cash and pension funds for car industry, real estate, electronics, etc. The degree of saving lowered in the U.S. but in 2007 less than 1% of revenue, and now, is located after the financial shock, felt by markets, to around 3%. It’s enough for a sustainable growth in the long term? We bent.
Increasing of the property prices have led to the appearance of mortgages, those who had a loan for housing could get some additional money for consumption. This kind of sport now disappears when the real estate market declines. In despair, people appeal to the credit card and to its exorbitant interest rates. Because to be complete, the U.S. printed money to cover losses in the hope that banks will resume lending and the economy will not suffer.
The distance between the crisis has the tendency to shorten, but the effects are increasingly harsh. Between 2000 and 2007 are only 7 years. In 2000 interest rates were lowered to 1% in the U.S. and this has led to a real estate bubble. To what bubble is moving us in the conditions in which interest rates are 0% and is already printed money.
After some stabilization of the situation, after the last injection in the financial system, the market fall can resume. And I believe that paper money will provide sufficient protection. We bid on something traditional, perhaps on a small farm which will ensure with food, and eventually with the energy.