Here We Go Again: Central Banks ‘Hiding’ Risk of Impending Global Recession
SputnikNews.com
11.04.2017
While analysts place the chances of a global recession in the near future at around 10 percent, investment firm Saxo ranks the risk closer to 60 percent, as borrowing reaches unsustainable levels across the Western world, and US President Donald Trump loses his market luster.
The bank’s global macro outlook maintains recession is more likely than not in the next 12 to 18 months. Moreover, Saxo is concerned about a significant “perception-versus-reality gap” in the market in respect of recession — namely, present economic conditions should inspire caution and conservatism among consumers, businesses and governments alike, but economic actors are appearing distinctly unaverse to risk.
The bank said high expectations of economic stability, or prosperity, in the years leading to 2020 were based purely on hope — and “hope belongs in church on Sunday.”
In the UK, banks are issuing loans and credit products at an alarming rate — the bubble has served to postpone a long-anticipated Brexit-inflicted economic slowdown, but how long fiscal gravity can be defied is questionable. Saxo is not alone in expressing grave concern about debt-dependency among consumers — the International Monetary Fund (IMF) lashed out April 7 at unconventional monetary policies instituted since the Great Recession of 2008/9, such as nigh on non-existent interest rates, which have made borrowing easier than ever.
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