Global Systemic Economic Crisis

Global Systemic Economic Crisis: Devastating Financial Explosion and Social Outburst on a Worldwide Scale
By Global Europe Anticipation Bulletin (GEAB)
Global Research, June 17, 2013
Global Europe Anticipation Bulletin (GEAB N°76)
Theme: Global Economy



The 2008 shock was certainly violent, but the reactions of
the system, countries and central banks with their bailouts on an
unprecedented scale, managed to hide the worst consequences: downgrading
of the West in general and the United States in particular, a forced
cleanup of the economy, a heavy fall from an artificial standard of
living, mass unemployment, the beginning of social unrest… have been
able to be partly neglected in favour of recovery hopes kept alive by
irresponsible policies diverting liquidity to the banking systems and
stock exchanges.
Sadly, whilst the world drugged itself, global issues weren’t
addressed… five lost years: the building is even less strong than before
the crisis; the US “solution” orchestrated by the Fed, that everyone
else left it to manage to take the time to dress their own wounds, has
been to put out with gasoline the fire which they themselves lit. It’s
not surprising then that it is still the US, pillar of the world before,
refusing to fall in line, with their faithful Japanese and British
floats, which is once again igniting the world situation. And this time,
we shouldn’t rely on bankrupt countries to save the situation: they are
on their knees following the first shock in 2008.
Therefore, it’s actually a second world crisis which is looming, once
again caused by the United States. Ultimately this five-year period
will have been nothing other than taking a step back to enter into an
even bigger crisis, which we have called “the crisis squared”.
Layout of the full article:
1. A situation which is now out of control

2. A second US crisis

3. The impacts of the second shock

4. Different players’ strategies

5. Failure of international institutions

6. Urgent recommendations
This public announcement contains sections 1 and 2
A situation which is now out of control
The illusions which have still blinded the last remaining optimists
are in the process of dissipating. In previous GEAB issues we have
already laid out the world economy’s grim picture. Since then the
situation has got worse. The Chinese economy confirms its slowdown (1)
as well as Australia (2), emerging countries’ currencies are
disconnecting (3), bond interest rates are rising, UK salaries are
continuing to fall (4), riots are affecting Turkey and even peaceful
Sweden (5), the Eurozone is still in recession (6), the news filtering
out of the United States is no longer cheerful (7)…Nervousness is now
clearly palpable on all financial markets where the question is no
longer knowing when the next record will be but succeeding in getting
out soon enough before the stampede. The Nikkei has fallen more than 20%
in three weeks during which there have been three sessions with losses
exceeding 5%. So, the contagion has now reached the “standard” indices
such as the stock exchanges, interest rates, and currency exchange
rates… the last bastions still controlled by the central banks and,
therefore, totally distorted as our team has repeatedly explained.

Nikkei 225 Index, 02/11/2012-13/06/2013. The dizzy rise is due to the BoJ’s plan, the dizzy fall to current uncertainties Source : Les Échos.
In Japan this situation is the result of the over-the-top sized
quantitative easing programme undertaken by the central bank. The Yen’s
fall has brought about strong inflation in the price of imported goods
(particularly oil).



The huge swings in the Japanese stock exchange and
currency is destabilising the whole of global finance

But the
implementation of the Bank of Japan’s programme is so new that its
effects are still much less pronounced than those of the Fed’s
quantitative easing. It’s primarily the Fed which is responsible for all
the current bubbles: real estate in the United States (, stock
exchange record highs, bubbles in and destabilisation of emerging
countries (9), etc.It’s also thanks to it, or rather because of it, that
the virtual economy has got going again with even greater intensity and
that the necessary balancing hasn’t taken place. The same methods are
producing the same effects (10), an increased virtualisation of the
economy is leading us to a second crisis in five years, for which the
United States is once again responsible. The central banks can’t hold
the global economy together indefinitely; at the moment they are losing
control.