Quaker

Perhaps There Are Unseen Green Shoots

I believe that we're in a systemic change in currency and trade regimes worldwide, similar to that which happened in the late 20's in Germany and in 1870's in London and Amsterdam.

The changes we're going through are more historical than economic. The reason we gor into trouble was the China, Saudi trade caused an excess of dollars to enter the market and and excess of IOU's to be issued. This caused interest rates to get absurdly low and destroyed worldwide equity.

Nothing we do is going to change this until we get either a new trading regime (a replacement for fiat reserves) or we take it on the chin and write debt down 30%. In fact, both are happening. China is using the Renmimbi as a trading currency with select partners, certain commodities are not following the spot markets, (Iron ore and heavy middle eastern crude) and countries are cutting side deals with each other outside US and Euro influence.

In fact,this will be exasperated in the coming year. Why would China expose itseld to bubble prices in commodites caused by wreckless Goldman Sachs traders? Why would they expose their trade wiith Brazil to the whims of a intellectual moron like Ben Bernanke.

Most people, especially economists, lack the ability to see the world in three deminsions. Currency's are nothing other than tradable debt instruments. Throughout history tradable debt instruments have become worthless as the worlds traders shunned them. This time is no different. If the world economy is going to grow again, it's not going to do it carrying the weight of 30 trillion in loans on it'sback.