Sunday, February 1, 2009

Depression ¨2.0¨

While the big wigs in Davos discuss how the world economy ended up such a mess, the rest of the world know damn well what happened. Greed. Pure and simple. The economy was healthy for too long, lenders forgot about the past and took too many risks based on dodgy virtual fincancial constructions like derivatives for short term financial gains. Consumers were encouraged to take loans and mortgages that they couldn't afford. You can't really say we didn't see this coming. But as we have failed to learn from past lessons, when this is all blown over in a few years, will we still remember or kid oursleves into thinking that this will never happen again and repeat the cycle anew?

Now I´m no economist, but there are plenty of people who have seen this whole money creation bubble
coming and the strange relationship of the Federal Reserve to the US becoming unsustainable for a while, like here. What they describe is happening now, and the end result does not look pretty. If the situation really does collapse, then maybe all those FEMA camps will be required to get a grip on a starving and frightened population.