I read a forecast for 2009 prepared by researchers at Standard Bank. I felt it was quite optimistic. I emailed a few of the people involved and we're now in fairly frequent discussions via email. The critical question is this:
How bad is the current, global, financial malaise?
Well, it's bad. Is it really bad, or really really bad?
Really bad = a recession.
Really really bad = a depression.
So far, we've tended to err on the side of underestimating the crap that's going down. In terms of climate change, in terms of the credit crisis when it first manifested (a lot of economists and bankers fobbed it off or dismissed it as no big deal, and recession talk was also called 'doomsday'.)
Right now it looks like Japan has charged ahead into a Depression, with the UK, USA and Poland hot on the heels of their - Japans' - financial decrepitude.
Why is Japan having it so bad? Well, because Japans economy is based on making and exporting cars. The car market is dead. Because the housing market is dead. And thus financing is dead.
The implications of a Depression in the 21st century aren't great. We can anticipate, generally, an upsurge in crime around the world (the Somali pirates are one exponent of this, terrorism and looting is another). Disease - associated with stress and also associated with a changing environment - will probably flare up in a series of widening pandemics.
And Climate Change - severe weather - is likely to trouble us in our distress even more.
The temptation to go to far over water or some other excuse is likely to increase over the next phase.
It's not cool by the pool. It's getting less cool with each passing moment. Try to keep your head though, while those about you are losing theirs. If you can do that, tell me how.
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