Total collapse of the Global Economy by 2019, can it be true?

 

I was looking at global data for one of my projects and I checked how much is the Global Gross Domestic Product, or how much all humans produce in a year and it is approximately $63 T.

On the other hand the Global Government-only debt stands currently at $40.5 T http://www.economist.com/content/global_debt_clock.

By the way, the global household debt exceeds these numbers.  According to a study sponsored by Credit Suisse, global wealth amounts to $ 195 T,  https://www.credit-suisse.com/news/en/media_release.jsp?ns=41610 ,on the other hand global house hold debt amounts to 67.5% of the Global GDP of $63T or $42.5 T, https://www.allianz.com/static-resources/_assets/homepage/en/gwr2011/v_1315816862000/globalwealthreport2011en.pdf.

If we accept, that the average interest rate for Governments Bonds is 3% ,using the US as the average due to the nature of the USD a global currency  or $1.2 T http://observationsandnotes.blogspot.com/2010/11/100-years-of-bond-interest-rate-history.html , then the global growth, in order to eventually repay this debt, should be at least >3%…..Well guess what, IT IS NOT.

To be accurate it stands at 0.8% and its trend shows no signs of recovery!  If that is not devastating enough global inflation runs currently at 4.7%  http://www.gecodia.com/World-Inflation-up-again-in-May-2011_a1926.html

That means that instead of reducing the global debt, we increase it by [(3-0.8)+4.7% =6.9%]  per year. With this rate it will take anything between 12 to 15 years for all values reach zero (0) and anything between 6 and 9 years under the current economic model to reach a point of no return and a total crush.  

One might say that if you see the system overall then there is a surplus of (195-42.5-40.5=112 T) so somehow all these years of work of the humanity as a whole did not come up to nothing and of course you would be wrong. Just contemplate the fact that 93 to 97% of all money are fiat reduces this value to less then 10T in real values. How much can they last? I am afraid unless proven otherwise the 6 to 9 years is all we have.

So what do we do? The answer is simple correct the systemic deficiencies and start now!

We have one solution on the table Gaianomy more will be a welcome sign but please let us act.

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One Comment to “Total collapse of the Global Economy by 2019, can it be true?”

  1. Good read, I just passed this onto a colleague who was performing slightly research on that. And he just bought me lunch since I identified it for him smile So let me rephrase that: Thank you for lunch!

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