It’s not an economic crisis but a silent coup against world economy. That’s the title of my forthcoming book. I’m not free enough to finish it. I decided to writing articles giving an overview on that coup. It will be written in series, just like Harry Potter of J.K Rowling or Women’s Murder Club of James Patterson.
This article is just a note. It was a successful coup to topple global economy. To some extent, the Great Recession was both structural and cyclical. I’m still doing research on that issue. So, my writing may be somewhat misleading. But I created this blog for learning and sharing. I’m not afraid of making mistakes.
People are saying Asia is winning the economic war. I’m skeptical about that. What did we get from global economic crisis? I encourage you to post you comment. I will put special focus on emerging markets and developed countries. For me, the great crisis of 2008 is a deliberated plot created to take advantage from the collapse of global financial system.
An economic crisis is just like cancer. It takes about 30 to 40 years to explode. I found out many factors make us to this mess. 1. Income inequality in America. 2 lack of proper regulations 3. The introduction of Financial Service Modernization Act approved during Clinton’s second term. 4. Tax Break during Bush’s terms 5. The greed of investors 6. Willingness of American Government.
The income inequality makes Middle class Americans indebted. Then the subprime came. Average Americans were in rush to buy the houses in the hope of making profit. The housing prices were up mainly because of speculation. Banks were also making too generous loan. The bubble was becoming bigger and bigger. It burst after reaching the peak.
The confidence in financial market was rattled. Investors didn’t have confidence on the economy and the economic crisis erupted. The greed and corruption in global financial system turned American crisis to World crisis.
I’m going to write about Cause, Containment and Cure. I will start with income inequality. I divided the countries affected by the crisis into three categories. 1. The countries that win: United Sates, Germany, France… 2. The countries that capitalized from the crisis: China, South Korea, Taiwan… 3. The countries that failed: third world countries in Africa, Asia….
It needs a lot of evidence to support my claim. There will be a lot of references. How on earth did they create it? Why America is the biggest winner, not China? What is the future of global economy? The next article may answer your doubt.