A World on the Brink of Change-JR NYQUIST!
Europe is financially deteriorating, absorbing the attention of economic and political actors around the world. Change is coming. The New World Order proclaimed by George H.W. Bush is no longer in effect. Economic optimism has evaporated. Crises have multiplied. The military power of the United States has begun to decline while China continues to enlarge its army and navy. In the Middle East, Iran is continuing to advance its nuclear weapons program. The global economic crisis has triggered revolutions (through food shortages) – the fall of Egypt’s Mubarak and Libya’s Kadafi. Today Russia’s government is facing a crisis of confidence that will force a decision in Moscow: either genuine reform, or a return to outright Stalinism.
Last week, Citi Group’s Willem Buiter said (on Bloomberg TV) that time is running out for Europe. “I think we have maybe a few months – it could be weeks, it could be days – before there is a material risk of a fundamentally unnecessary default by a country like Spain or Italy which would be a financial catastrophe dragging the European banking system and North America with it.” According to Buiter, the European financial system is determined to respond to the crisis “with both hands tied behind its back.” There is a lack of preparation, of underpinning. The most likely solution, he suggested, will probably spell the “end of the euro zone.”