This is not Thailand related. Albeit… well yes it is totally Thailand related.
I said before that I was a fan of Mike Shedlock (Mish). This US blogger announced the crisis with an astonishing accuracy. As soon as 2005 (yes ladies and gentlemen)… He’s very prolific and he’s a hard core deflationist.
He wrote a few days ago a striking piece, based on an analysis of the official Flow of Funds Report for the first quarter of 2009 from the FED.
Sounds technical and boring ? Absolutly not.
Just an amazing HARD EVIDENCE (coming from the FED) that the credit crisis isn’t solved. At all. It’s even getting worse.
And as you know, credit is the lifeblood of our modern economies.
Excluding public sector borrowing (by the Treasury, government agencies, states, and municipalities), private sector credit was reduced at a mindboggling pace of $1,851.2 billion per year! […]
“In U.S. households alone, the losses have been massive: massive: $1.39 trillion in the third and fourth quarters of 2007 (not shown on page 105) … a gigantic $10.89 trillion in 2008 … $1.33 trillion in the first quarter of 2009 … $13.87 trillion in all, by far the worst of all time.” […]
Bottom line: The first quarter brought the greatest credit collapse of all time.
This article will show you that the Green Shoots are a pleasant joke. With such a credit implosion and wealth destruction, the US Economy (and the world economy) can’t fire up again. No way.
It’s not a “if”, it’s not a “may be”, nor a “theory”, but rather a burning fact.
Let me rephrase : you must read it (along with the original analysis from Martin D.Weiss) . 😉