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Generational Dynamics Web Log for 13-Aug-2010
13-Aug-10 News -- Greece's economy goes deeper into recession

Web Log - August, 2010

13-Aug-10 News -- Greece's economy goes deeper into recession

Worldwide heat prices surge after USDA lowers forecast

Greece's economy goes deeper into recession than forecast

Deep into August, with seemingly half the world on vacation, it almost seems as if nothing is happening. And yet, bills continue to pile up, even in summer, and notes become due, and people still have to eat.

So it's perhaps not too surprising that Greece's economy is turning out to be worse than expected or predicted, after the huge European bailout in May, triggered by Greece's impending financial default. (See "11-May-10 News -- Europe's super-nuclear bailout.")

Greece's economy - growth rate - 2008 to present <font size=-2>(Source: Market Watch)</font>

Greece's economy - growth rate - 2008 to present (Source: Market Watch)

As the graph shows, the growth rate of Greece's economy turned negative in Q3 2008, and it's been negative ever since.

On Thursday, Greece announced the biggest fall in recent times. Experts had predicted that Greece's growth rate would hold steady at around -1.0%, but it now turns out that in Q2, the rate was -1.5%, according to MarketWatch.

What's even worse is the overall trend since Q1 of 2008, which is clearly downward, and there's little hope in sight of a revival.

Notice that the one time when the growth rate increased -- in Q2 of last year -- was the time when the U.S., China, Europe and other countries were pouring trillions of dollars in bailouts and stimulus packages into the global economy, resulting in last year's stock market rally. But Greece's economic growth only last one quarter, not even as long as the stock market rally.

Furthermore, the most recent collapse, in Q2 of this year, coincides with the collapse of many other economic indicators, as I've been describing for two months now, starting with "7-Jun-10 News -- Globally, May was a month of ominous events."

Early in 2009, I was expecting the world economy to keep collapsing, but I turned out to be wrong because of something like $10 trillion dollars in stimulus and bailout money injected into the world economy.

But nothing like that is about to happen now. People around the world are panicked about the high levels of government debt everywhere. Whereas Presidents Bush and Obama were able to get trillion dollar stimuluses and bailouts passed in 2008 and 2009, nothing like that is possible in 2010.

This mood is apparent from a survey of 57 economies published on Thursday in an article in the Wall Street Journal (Access). The economists were generally very pessimistic about the U.S. economy, but nonetheless most said that the economy doesn't need any more fiscal or monetary stimulus.

The economic pessimism was increased even further on Thursday when new claims for unemployment insurance hit their highest level in six months, according to VOA. 484,000 people signed up for unemployment insurance last week, when the experts were hoping that the figure would fall to 400,000.

Generational Dynamics predicts that we're headed for a major worldwide financial crisis, the worst in history, because the world has created an amount of debt astronomically larger than at any time in history.

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The U.S. Department of Agriculture (USDA) revised downward its global forecast for wheat product, by 2.3% less than July. Much of the downward revision was caused by Russia's drought and the hottest summer in 130 years. Wheat prices surged 2.5% on Thursday, giving rise to fears of food riots. Associated Press.

The North Korean football (soccer) team that lost three games at the World Cup games this summer are being harshly punished by Kim Jong-il's government. World soccer officials will conduct an investigation. LA Times

Floods in Pakistan are still growing, in a disaster of epic proportions. The rains have destroyed 500,000 tonnes of wheat and 500,000 tones of sugar, exacerbating the food shortages. Reuters

The commander of Iraq's military has indicated that U.S. troops should not leave Iraq, since the Iraq army will not be ready to defend the nation until 2020. Long time readers will recall that I've said that it's my expectation that the U.S. will not withdraw from Iraq until forced to by the Clash of Civilizations world war. Associated Press

The spreading revolt in Kashmir is causing India to reevaluate its strategy there, although there seem to be no answers in sight. NY Times

India is joining United Arab Emirates (UAE) and Saudi Arabia in threatening to shut down BlackBerry email and messenger services, unless the vendor, Research in Motion, makes the contents of encrypted messages available to the government. India's deadline is August 31. Reuters

If you take a picture with a smartphone or a digital camera and post it on the internet, then you may be revealing more than you realize about yourself -- specifically your location. These devices use the GPS capability to implant a "geotag" into the picture that an expert can use to determine where the picture was taken. NY Times

Turkey is being accused of using chemical weapons against PKK militants. Spiegel

The Arab League has issued a statement saying that the Palestinians' "right to return" to their land in Israel will be on top of their list of priorities. Eurasia Review

Mexico hopes $270 million in social spending will help end Juarez drug violence. Fat chance. Washington Post

A team of French scientists have finally discovered how to drink champagne properly. Start by pouring it into a tilted glass. Tonic.com

(Comments: For reader comments, questions and discussion, see the 13-Aug-10 News -- Greece's economy goes deeper into recession thread of the Generational Dynamics forum. Comments may be posted anonymously.) (13-Aug-2010) Permanent Link
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Generational Dynamics Web Log for 13-Aug-2010 13-Aug-10 News -- Greece's economy goes deeper into recession

Greece's economy goes deeper into recession than forecast

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Generational Dynamics Web Log for 13-Aug-2010
13-Aug-10 News -- Greece's economy goes deeper into recession