Last week I was interviewed
by Constantine von Hoffman for a CBS news article regarding economic nightmares
for Obama's 2nd term.
Calculated Risk was interviewed as well. His nightmare scenario is war, specifically
noting the rise of Golden
Eight people were interviewed for the CBS article but the organization was maddening. Specifically, there is no way
to see all 8 viewpoints
of people interviewed at
once. You have to click through pages one at a time. I was
curious enough to do it, Calculated Risk gave up after the second
In a clear effort to generate clicks, articles like this are an extreme turn-off and actually counterproductive. That no readers
emailed me with a link to this article says no one bothered clicking through all the pages.
I talked to von Hoffman
about numerous things, only one was mentioned in the article. Many
of my points were of the
nature of things I think should happen (and would benefit the global economy over the long run if they did), but most economists would disagree.
the Fiscal Cliff
Breakup of the Eurozone
falls to Zero Because of Rebalancing
Currency Crisis in Japan
Failure to address pension problems in US
Rise of the Neo-Nazi
Golden Dawn Party in Greece Leads to War
I mentioned all of those things and more. The first four are things
that I actually believe need to happen (and the sooner the better) to prevent a global nightmare!
Unfortunately, most economists want to kick the can down the road still more.
For a discussion of the fiscal cliff, please see Misdiagnosing the Fiscal Cliff; Shrill Voices and Economic
Nonsense; Tyranny of Balanced Budgets
A breakup of the eurozone
is inevitable in my opinion. For a detailed explanation why, please see Spain's Unpleasant Choice: Accept Lower Wages and Still
Higher Unemployment, Leave the Euro and Default.The sooner
a breakup happens the better. Delays end up like Greece.
In regards to China, please consider
"China Rebalancing Has Begun"; What are the Global
Implications? Michael Pettis on China Rebalancing, Chinese Price Deflation,
and Spain Exit from Euro; Target 2 Revisited.
Note that can-kicking in Greece has led to the rise of the Golden Dawn party. Expect
the same to happen in
Spain if the agony lasts
Essentially, my nightmare scenario is more can-kicking exercises until the entire global economy blows up in a currency crisis and radical
parties like Golden Dawn gain prominence
everywhere, fueling political as well as economic violence.
I had war in the Mideast with spiking oil prices
as part of my nightmare
scenario that I mentioned
to von Hoffman. I simply forgot to mention it when I typed this post up earlier today.