1/64th Diorama Buildings

gamble till you drop, or, for the world economic crisis beginners.



"If people understand how our monetary system, we had a revolution - and tomorrow morning." (Henry Ford, 1863-1947)


I have something more on the financial crisis blog and wanted to list some factors, how it happened, according to all the current theories, here a little longer blog post about the economic crisis. In my opinion, this crisis rather more profound causes that are justified in principle by our capitalist system as a whole, but I now want to first write something less, perhaps later at a time. (It should be time to look at, for example when a country is going broke, so if he use his interest any more. The whole system rests on a model of the Romans and is actually now become obsolete in a pre-globalized world, or has a self-destructive character. But as I said, I'm sure at times a go again separately)

The outbreak of the economic crisis in 2008 came about through many factors. It began with the bursting of the bubble in the U.S. real estate market, anno 2004, which was Created by a long period of rising house prices. At that time, more families than ever were able to obtain mortgages and banks began in so-called "subprime" business to enter. These were high-risk lending to the debtor. The subprime mortgage
were characterized by small interest rates, which increased dramatically after years. Moreover, the risks to the debtors were not explained fully, and suggests that we can refinance the loan in a few years to keep the interest rate remains low. Warnings were ignored by serious economists (as so often), because each started from the construction of estate agents and banks make money seemed to deserve. For the debtor had the advantage that it could be the first time in their lives homeowners. A tempting offer for many families Lock, which was driven by decades of deregulation, especially the Republicans, made it possible.

shot in 2005/2006, then the interest rates on subprime loans in the air. The result was that many, the new homeowners pay their mortgages no longer could. By the time the crisis would be confined only to the U.S. housing market were it not for the banks and lenders who resell these loans in the world. This occurred in complicated financial packages had hardly any truly understand, a kind of global "musical chairs" with no known rules for the actors. In 2007, nearly 1.3 million have been (!) U.S. housing forced executing. It was followed by a panic that spread to the global financial system, since no one seemed to know who owned the worthless promissory notes. Financial institutions were given namely, no more credits and remained sitting on bad loans. There were bankruptcies.
Fearing the effects on the global economic "bail-outed" many governments of the ailing banks. The most famous were Freddie Mac and Fannie May (USA), Northern Rock (UK) and Hypo Real Estate in Germany. Just the USA adopted a 700 Billion dollar bailout package.

The economic crisis can dissolve in many parts of the world a shock. Critics who were so far mostly on deaf ears, had a boom. How could the force in a country Fuckup entire national economy to its knees? More and more people the economic crisis seemed to finally give an opportunity to make our kind of economic thought. For some, seemed to "greed" of bankers responsible for more and better returns, while others led to more in-depth, systematic causes of the crisis.

The Economist Gunther Tichy Austrian Academy of Sciences of the stresses for example the changes financial institutions in recent years. For him, too much saving and high returns on speculation, but at the same time investing too little. Taking aside the fact that the Präkäriat and large parts of the middle class have become nothing more, can invest what they save or not, he may well be right. He says for example that there is in the financial markets has long been an over-supply, the banks are advised him, according to a plant emergency, because they get more savings from the rich than they can safely and profitably invest again. This is partly the result of the exploding income from high commodity and agricultural prices to justify, partly resulting from an unequal and unfair Einkommenverteilung, sowie auf Export gerichtete Politik. Die "emerging economies", also Volkswirtschaften die an der Schwelle vom Entwicklungsland zum Industrieland stehen, waren traditionell immer "Kreditnehmer". Mittlerweile wurde dieser Trend umgedreht. China kauft z.b. wie besengt US-Staatsanleihen und ihr BIP lag 2000 pro Kopf bei 9,73%, während Deutschland mit 2,92% und die USA mit 3,63% weit darunter lagen. Das hat zur Folge, dass z.b. China der neue Kreditgeber geworden ist.

Die Anlagemöglichkeiten der Banken schrumpfen dadurch, das diejenige, die kreditfähig wären, keine Kredite brauchen oder wollen, da Schuldner immer ein hohes Risiko tragen. Außerdem sind u.a. in Folge von Schuldenbremsen viele Staaten failed as a potential borrower. Another important aspect to be observed is that wealthy people are necessarily no longer satisfied with a savings account because the interest on that as a result of excess supply of savings appear to be barely cover the inflation. Therefore, they push for higher-income assets. (See eg subprime mortgages)

The really logical fact that the highest returns are associated with the highest risk of self-educated, successful people largely ignored unless it is not serious crises. This "risk-ignorance" is of unsound financial institutions exploited without doubt, that it promises high uneinhaltbaren comes, the high rate of return by supposedly "safe" investments is that takes the customer happy.

In summary from Tichy's closing remarks that two aspects of the economy to collapse, brought and will continue. to invest 1) the unwillingness in solid companies and thus stimulate the economy, and 2) the hunt for high returns on supposedly "safe" conditions. The actors of capitalism have thus the meaning for the common good of society is lost.

If this trend continues we are sliding back into another crisis, which, according to economists will be more severe as the last. If states ailing financial institutions no longer can save, which, according to the standard economic theory of the collapse to follow. (It really is clear: if the institutions that your money manage bankruptcy are you too)

Ps:
Another important factor in world economic crisis and was a record high price of oil, among other things due to the increased energy demands in China and India. An important, non-negligible factor plays "peak oil, global oil production peak, which is reached when about half of all the usable oil reserves has been reduced. Then the output flow decreases annually by about 3-6% until it finally complete (like all commodities, oil is only limited stock of the world) is used up. First, that is, the increased
Trebstoff and heating costs. In addition, this had drastic effects on the transport costs, food prices. In developing countries, food was so expensive that it sometimes resulted in riots by famine was (and will continue to come).