KingM wrote:As a caveat, although I believe in big disruptions from PO, I'm not a doomer, and still hold out hope that we'll get through to the other side without a massive collapse.
Having said that, I'm puzzled by the continued economic boom that has now spread beyond China to India, Russia, Brazil, SE Asia and quite a few other countries. Africa, as always, is a basket case, and Latin America is mixed, but most other parts of the world are growing smartly. I find this hard to fathom in light of high oil prices.
Any thoughts?
KingM wrote:As a caveat, although I believe in big disruptions from PO, I'm not a doomer, and still hold out hope that we'll get through to the other side without a massive collapse.
Having said that, I'm puzzled by the continued economic boom that has now spread beyond China to India, Russia, Brazil, SE Asia and quite a few other countries. Africa, as always, is a basket case, and Latin America is mixed, but most other parts of the world are growing smartly. I find this hard to fathom in light of high oil prices.
Any thoughts?
KingM wrote:As a caveat, although I believe in big disruptions from PO, I'm not a doomer, and still hold out hope that we'll get through to the other side without a massive collapse.
Having said that, I'm puzzled by the continued economic boom that has now spread beyond China to India, Russia, Brazil, SE Asia and quite a few other countries. Africa, as always, is a basket case, and Latin America is mixed, but most other parts of the world are growing smartly. I find this hard to fathom in light of high oil prices.
Any thoughts?
1. On the price of oil demand shocks have proved more important than supply shocks. This is working with historical data going back to 1973, so it is no guarantee looking forward is historical patterns breakdown. None the less it is for many here counter intuitive.
2. There is only a casual relationship between the price of oil and GDP growth. This may be why we have seen strong global growth in the past few years despite rising energy prices as well as commodities and base metals as well as the higher prices have been lead by demand.
3. The price of oil responds to GDP growth, but only with a delay.In otherwords, cheap oil does not necessarily result in higher economic output (think Japan in 1990s), but higher economic output will eventually lead to higher energy prices due to demand using up slack existing capacity.
KingM wrote:Having said that, I'm puzzled by the continued economic boom that has now spread beyond China to India, Russia, Brazil, SE Asia and quite a few other countries.
Russia (M3): ---------- +49%
India (M3): ------------ +20.3%
China (M2): ----------- +17.2%
New Zealand (M3): -- +18%
Australia (M3): ------- +13%
Great Britain (M4): -- +13%
South Korea (M3): -- +11.3%
USA (M3): ------------- +12% (Est.)
Canada (M3): -------- +10%
Eurozone: ------------ +10%
Japan (M3): ----------- + 6%
*Data from John Embry, Sprott Asset Management, Toronto, Canada.
KingM wrote:As a caveat, although I believe in big disruptions from PO, I'm not a doomer, and still hold out hope that we'll get through to the other side without a massive collapse.
Having said that, I'm puzzled by the continued economic boom that has now spread beyond China to India, Russia, Brazil, SE Asia and quite a few other countries. Africa, as always, is a basket case, and Latin America is mixed, but most other parts of the world are growing smartly. I find this hard to fathom in light of high oil prices.
Any thoughts?
KingM wrote:I agree with many comments on this thread. However, the real economic growth measures of increasing manufacturing and rising standards of living in Third World countries are also increasing. With oil prices through the roof and other energy costs high as well, I can't figure out how this is happening.
It does give me hope, however. The undulating plateau that we seem to be entering gives us more leeway and more time to transition to other energy sources. It's going to mean a huge headache, but there's no question we have enough energy and money to make these changes if we start sooner, rather than later.
KingM wrote:I agree with many comments on this thread. However, the real economic growth measures of increasing manufacturing and rising standards of living in Third World countries are also increasing.
KingM wrote:With oil prices through the roof and other energy costs high as well, I can't figure out how this is happening.
It does give me hope, however. The undulating plateau that we seem to be entering gives us more leeway and more time to transition to other energy sources.
It's going to mean a huge headache, but there's no question we have enough energy and money to make these changes if we start sooner, rather than later.
Heineken wrote:Expressions like "growth" and "economic boom" are hollow ones. They are symptoms of our terminal disease.
The only capital that matters is natural capital, and that is in bankruptcy or nearly so.
FoxV wrote:Because the US money supply growth is now exceeding 13% (latest on Shadowstats.com The rest of the world has to print to match the US debasement, or to nationalize the USDs coming in. The results is a huge amounts of cash flooding the markets, causing booms all over the place (remember US represents 25% of global GDP, so whatever they do has a large effect on the world markets)
The Mogambo Guru wrote:The Bank for International Settlements (BIS) has reported that the total clot of global derivatives in existence is now $415.2 trillion, with comes out to 789% of global GDP.
In typical Mogambo parlance, grubby financial bets financed by banks and the financial services industry now total almost eight times the value of every freaking good and service produced on the entire freaking planet in an entire freaking year!
KingM wrote:Having said that, I'm puzzled by the continued economic boom that has now spread beyond China to India, Russia, Brazil, SE Asia and quite a few other countries. Africa, as always, is a basket case, and Latin America is mixed, but most other parts of the world are growing smartly. I find this hard to fathom in light of high oil prices.
Any thoughts?
A decade after the world descended into a devastating economic crisis, a key marker of revival has finally been achieved. Every major economy on earth is expanding at once, a synchronous wave of growth that is creating jobs, lifting fortunes and tempering fears of popular discontent. No tidy, all-encompassing narrative explains how the world has finally escaped the global downturn. The United States has been propelled by government spending unleashed during the previous administration, plus a recent $1.5 trillion shot of tax cuts. Europe has finally felt the effects of cheap money pumped out by its central bank. In general terms, improvement owes less to some newfound wellspring of wealth than the simple fact that many of the destructive forces that felled growth have finally exhausted their potency. The long convalescence has yielded a global recovery that is far from blistering in pace,
Alfred Tennyson wrote:We are not now that strength which in old days
Moved earth and heaven, that which we are, we are;
One equal temper of heroic hearts,
Made weak by time and fate, but strong in will
To strive, to seek, to find, and not to yield.
onlooker wrote:It is but temporary. As, all major Economies are now relying for economic vitality on fiscal stimulus ie. Debt. This has become over recent years more and more evident and widespread. And the Stock markets are buoyed by these QE and falls into ballon dynamics. So all this is more akin to a Ponzi Scheme and to healthy fundamentals for the world Economy.
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