New economic data out of Germany shows even the economic heavyweight is starting to get hit by the slowing economy. Here is the direct link.
Meanwhile the World Economic Forum issued its annual report on the global economy today warning that the “seeds of dystopia” are being sown:
“The growing number of young people with little chance of finding a job, the increasing number of elderly people dependent on states deeply in debt and the expanding gap between rich and poor were all fuelling resentment worldwide, the forum said in its Global Risks 2012 report on Wednesday.
“For the first time in generations, many people no longer believe that their children will grow up to enjoy a higher standard of living than theirs,” said Lee Howell, the WEF managing director responsible for the report. “This new malaise is particularly acute in the industrialised countries that historically have been a source of great confidence and bold ideas.”
The survey of 469 global experts identified chronic problems with government finances and severe income inequality as the most prevalent risks over the next decade.
“These risks in tandem threaten global growth as they are drivers of nationalism, populism and protectionism at a time when the world remains vulnerable to systemic financial shocks, as well as possible food and water crises,” the report said.”
The longer the status quo tries to pretend and extend and maintain present structures and preferences, loop-holes and unfair advantage, the more painful the next phase of socio-economic transition will be-for all of us.
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The seeds of dystopia. I like that, because thats exactly what’s coming down the pike.
I can smell the gunpowder now of the new American Revolution. Generational war.
The kids didn’t create the Grand Bargain of paying for the oldsters wonderous retirement and quite frankly, would just as soon get them off their backs, but hopefully in a polite manner. It has to be done or the Republic will collapse.
The book “The Fourth Turning’ written in 1995 spells this all out fairly well. And if foretells of a Great Devaluation. Homes, stocks, currencies that will leave a lot of formerly well-off people not so well-off, right on the doorstep of retirement.
I can’t stress enough you save, save and save even more and that doesn’t not mean invest, invest, invest. Starve the beast by not spending. That is the collective defense.