Global economy in ‘perilous phase’, IMF says
The International Monetary Fund (IMF) has painted a grim picture of the outlook for the global economy over the next few years.
Its latest World Economic Outlook said global economic growth would bottom out at 2.8% this year before rising to 3% in 2024.
The rate of inflation would decrease globally, but more slowly than expected, from 8.7% in 2022 to 7% this year and 4.9% in 2024.
…that was the ‘good’ news. Here’s the bad news…
”A sharp tightening of global financial conditions–a ‘risk-off’ shock– could have a dramatic impact on credit conditions and public finances especially in emerging market and developing economies, with large capital outflows, a sudden increase in risk premia, a dollar appreciation in a rush toward safety, and major declines in global activity amid lower confidence, household spending, and investment.”
He said, in that sort of severe scenario, global GDP per capital could come close to falling, an outcome the IMF estimated had probability of about 15%.
“We are therefore entering a perilous phase during which economic growth remains low by historical standards and financial risks have risen, yet inflation has not yet decisively turned the corner. More than ever, policymakers will need a steady hand and clear communication.
…15% chance of a drop in GDP if financial markets meltdown.
Good to know.
The argument the IMF Wonks put forward here is that corporations have price gouged so much that they can afford demands for crumbs from the workers in wage rises, and that once the workers are bought off by those crumbs inflationary pressures will ease which seems remarkably optimistic in terms of wage demands from a desperate workforce and the fact that most mainstream economists have over estimated global growth and under estimated inflation.
This is an acknowledgement that an economic recession is coming and the technocrats are arguing amongst themselves over how severe it might be.
There is a tsunami of inflation erupting around the world as the baseline price for everything jumps as the West move just-in-time-supply chains to just-in-case supply chains.
What is exacerbating this is the war in Russia and Ukraine because both those countries are base ingredient trading powers.
Exacerbating that is a climate change environment that is interrupting the agricultural cycle as well as causing damage that can’t be repaired in time for the next extreme weather event.
Exacerbating that is the $25Trillion Central Banks printed to stave off the Global Recession which are all now propping up property and stock market bubbles in a late stage Capitalism Economic cycle.
House prices are sliding and will soon implode.
The enormous speculative debt will force first time home owners out of their homes.
Wait for the corporate banks and their begging bowls carried in on the back of homeless children crying out for bail outs.
The Black Swans aren’t just circling Comrades, they’re in the uber on their way over.
Everything since 2008 has been a building speculative bubble made possible by lowest cost capitalism via China’s manufacturing work force. Those global labour supply chains have ruptured and as Central Banks are forced to continue raising rates to choke off hyper inflationary pressures, those parts of the financial world using lower interest rate dynamics to trade will implode under the weight of the debt.
Factor in how AI Chatbot is estimated to cause 300million job losses as the skill base of many are made as meaningless as knitters when the loom was invented.
The savagery of bust and boom Capitalism is coming and she be a ruthless Mofo.
With the looming economic implosion upon us, we need clear guidelines.
1: No bank bail outs except for KiwiBank – These Bank fucks led us here, fuck them a thousand times if it all goes belly up and they need bail outs! Rule one is no bank bail outs!
2: Help owner occupier first time home owners – Kiwibank should be prepared to step in and take any owner occupier first time home buyers off other banks to prevent mortgagee sales, but fuck the speculators. They should all be forced to sell.
3: No corporate bail outs. NONE!
4: Continue to fund universal services that save people real money each week: Free Public Transport, free school breakfasts & lunch, 30% stakeholder role in smashing up Supermarket Duopoly to force down prices alongside GST off food and vegetables.
5: No corporate bail outs. NONE!
…I swear to the little baby Jesus, I’m going to lose my shit if Grant starts bailing banks, speculators and corporations out while ordinary people suffer.
The Left need to be kinder to individuals and crueler to Corporations.
People will not understand why Adrian Orr, a technocrat they never voted for, is going to burn the economy to save the economy. The disconnect between ‘this is good for the nation but shit for you’ will become detached from reality in the same way the Trans debate, antivax debate and the pineapple on pizza debates have become.
For the record pineapple has to be on a pizza and anyone who disagrees is a pizza fascist.
Look folks, Economic Armageddon is a coming and we best brace for impact.
If the Left can not provide the intellectual grunt to push for Universal Left Economic Solutions, if all we can do is champion identity, then we will have failed the people.
Comrades – Your enemy isn’t a woman who says stupid shit about Trans people in a public park, your enemy are the Banks, Oil Companies, Billionaires and Property Speculators who continue to pillage this country while we are bickering over the narcissism of petty difference!
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Give a banker 15% and they’ll hypothecate that into 100% by the end of earning season.
Martyn – Time to start talking about the ‘Robin Hood’ tax again…i.e. the richest 1% individuals/trusts/organisations/corporates – paying extra tax, say 1% of their total assets.
85% that this will not happen…..
Looks like the better bet.
At 15% UBS is being forced to take over Credit Suisse and U.S. bond markets moved from weekly to daily auctions. That’s just a slither of the stresses we’ve seen and the short to medium term covid-19 responses that are dragging on well past there mandates. Just look at the charts.
“It is the mark of a truely intelligent person to be moved by statistics.”
You cannot trust the IMF and orthodox economics. The answer might be in the resurrection of the “Chicago Plan” concepts. Stop banks creating money out of thin air and make the state the sole creator of money. Have one state bank whose only function is to handle transactions. Those foreign banks and other money lenders will have their own money in the “OneBank” that does transactions that they can lend through the transaction bank. If they are not careful with their money, and money rich peoples bank loans, then then will go broke and disappear without bailouts. Separate money creating from money lending. The state will create all the money (not just 3%) and will be able to use it for universal basic public services. In the new (not a return to the old ways) heating up atmosphere, essential and necessary universal human needs are needed not the consumptive and polluting ways of the uber-rich.
Bad times, and when you don’t expect it look what the Beast from out from the earth has in store for you! (probably a Taiwan invasion, like he’s been telegraphing for a long time)
Then afterward it will be all about picking up the pieces better than you and ruling everyone with his centralized digital currency, hahahahaaaaaa!
Global recession and worldwide inflation.
Buggar me and hear I was, being told by ACT and National that it was all Jacinda and Labours fault!
The IMF is an American institute ay? Theyre Debt ‘Creation’ Vulture Capitalists ay??
Why would you believe their bs, ay???
Or your bullshit eh, what institute were you let out from?
85% change they have it wrong.
15% chance they have it right.
One is certain we can accept their expertise on this matter…. Eh!
It’s a risk for developing economies, not the developed economies Chinas economic warfare is targeting. Furthermore developing economies are Chinas cash cows.
China won’t let this happen because it would be too soon and affect the wrong markets. Like the GFC this’ll be punted down the road another 15 years to try again. While we bicker about 3~4 year stints China plays the long game. Probably should learn mandarin now.
” …I swear to the little baby Jesus, I’m going to lose my shit if Grant starts bailing banks, speculators and corporations out while ordinary people suffer. ”
LOL Bomber your always good for a laugh.
Of course he will bail them out its what Blairite New Labour finance ministers do.
Grant and his colleagues are the agents for upregulation of capitalism and are not about to get all socialist or even capitalist lite like Winston who always promisies to take on the rich mans economy but never does.
Once the Hobbits are being scared to death by stories of possible banking failure’s or more to the point overdue regulation on their banking practices and that they will loose everything they will attack the people who should be protecting them for not doing so.
The real truth or even much needed debate just simply won’t happen or be led by the MSM.
Government and the established state sector don’t exist to protect the vulnerable …there is no money in it and NZ Inc must make a profit or it don’t get done or funded.
Maybe a meltdown might bring about a change but the Grant’s and Chipkins of this world will have to have a gun pointed at their head before they renounce neoliberal kindness which if you dig down is not about kindness at all. That Adern and her NZLP colleagues perpetuated that lie makes it worse somehow.
“This is an acknowledgement that an economic recession is coming and the technocrats are arguing amongst themselves over how severe it might be.”
It’s not coming it’s here. Real wages are falling. Construction companies are falling. There is a row of empty buildings in Symonds St. Construction companies vacating their office space. Untennanted buildings in Kingsland and Morningside. Real estate sales and lease volume falling. Subdivisions going belly up. Mortgagee sales up. Aus crane index down. NZ crane index will be down in the coming months. Dairy payout down. Fixed mortgage payers are getting hit with 3 – 4% rate rises. Apparently we have been spending our money before it inflates away so Adrian Orr is going to make another 100,000 kiwis unemployed. Hope he invites a few of them over for a dinner party to explain why that’s a good thing.
The Plan To Make You Permanently Poorer
https://youtu.be/ViY-zI3b5JQ
?
Rich are still making money, maybe some targeted action perhaps.