“…it will surely take at least a decade from the beginning of the crisis for the world economy to get back to decent shape.”-Olivier Blanchard, IMF Chief Economist
“The current status of the economy and the global economy needs both Japan and China fully engaged.”-Christine Lagarde, IMF Managing Director
Officials with the International Monetary Fund (IMF) are making some very concerning statements.
While the U.S. main stream media seems focused on the economic disaster unfolding in Europe, the IMF says look to Asia. Maybe that’s because it’s looking more and more like the IMF policies in Europe are failing big time.
In fact, on 04 October 2012, the IMF just warned the European Union to get its rear in gear: “No one has the luxury of time, this is really urgent!”-Christine Lagarde, IMF Managing Director
Despite the urgent call to action by the IMF, some European leaders say the U.S. based IMF is actually delaying action: “There are circles, by which I mean the IMF, who are pressing for a delay until after the U.S. election in November…”-Dimitris Hadzisokratous, Democratic Left, one of three political parties running the Greek government
What about China and Japan? The IMF seems to think the two countries are the Holy Grail in saving the World economy. There are major problems with that!
Japan’s economy is in the toilet! Japanese factories have been laying people off, and offshoring what ever they can. Japan is in bigger debt than any European country (yet where’s the U.S. media coverage).
China is no longer the economic wunderkind it was just a few years ago. GDP growth is dropping. The Asia Development Bank (ADB) predicts it’ll drop almost two percentages, from 9.3% in 2011 to 7.7% for 2012, and even lower after that: “The years of two digit growth in Asia are coming to an end!”-Changyong Rhee, ADB chief economist
And why is the economy in China going down? Firstly the Chinese government imposed economic restrictions in the hopes of holding off inflation. But here’s the big reason; orders from Europe and the United States are way down.
Some of those orders are down because of the bad economies in Europe and the U.S., but also because of protectionist policies.
Many European countries have banned specific products made in China, and U.S. President Barack Obama imposed ridiculous tariffs on Chinese made solar power products (that move also killed the Hoku polysilicon factory in southeastern Idaho, that was hoped to provide hundreds of good paying jobs. smooth move exlax!).
The IMF is also expecting the cash flushed Chinese banks to help bailout Europe! Can you believe that? The Europeans are screwing over Chinese businesses and then the IMF expects the Chinese to help bail out the Europeans?
As expected the Chinese banks said hell no! Several major Chinese banks have cancelled their plans to attend the largest ever IMF/World Bank meeting, to be held in Tokyo, Japan, next week!
But get this, IMF chief economist, Olivier Blanchard, told Hungarian media that Japan would take decades to get its debt problems straightened out, and that the United States has become a financial deadweight: “It remains the case that, in a number of advanced countries, notably the U.S., a return to full health requires replacing some of the domestic demand that fueled growth before the crisis by external demand. But, the arithmetic is again unforgiving here.”
Blanchard also said inflation was “…necessary and desirable…”
So, in a round-a-bout way officials with the IMF are expecting any World economic recovery to be messy (are they expecting World War 3?), and they’re placing their bets on China and Japan (two countries on the verge of war with each other over some tiny barren islands)!
Like the Colonial Marine, Hudson, said in the kick ass 1986 movie Aliens: “Oh dear lord Jesus, this ain’t happening, man… This can’t be happening, man!”