We could be entering a future that none of us wants to face, a future in which we will be much poorer, a future in which we realize that everything Barack Obama tried only made things worse.
Most economists are debating whether the United States has led the world into a V-shaped recession, marked by sharp economic decline and an equally quick recovery, or a U-shaped recession, which takes a while to get under way but lasts a long time and takes a long time to climb out of.
But a minority of economists and economic analysts believe what’s happening is L-shaped. We are witnessing a global economic contraction resulting from years of artificial growth fuelled by personal, corporate and governmental debt. When we reach bottom, they say, we will stay there. Globalism will collapse, and deflation and depression will stalk the land.
“A ‘lost decade’ for the world economy is quite possible,” wrote Peter Boone, Simon Johnson and James Kwak in a much-discussed online analysis earlier this year on the website Baseline Scenario. “There will be some episodes of incipient recovery, as there were in Japan during the 1990s, but this will prove very hard to sustain.”
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