This simple graph explains why politicians around the world

[cronus]

http://www.smh.com.au/federal-politics/ ... j6x83.html

This simple graph explains why politicians around the world are struggling to revive their economies

There's a joke among economists that whenever you hear someone talking about a recession or stock market crash and they say "this time is different" then you know they don't know what they're talking about.

But global economies are experiencing something unique these days, and the fear gripping Chinese shareholders right now - which has infected Australia's stock market - is just one element.

The graph below illustrates why.
The chief economist of the Bank of England, Andrew Haldane, recently asked a couple of research assistants to produce a historical graph of global interest rates.
It exhausted them, but they found enough data to stretch their graph all the way back to the Babylonian empire of 3000 BC.

It was a monster effort, and we're thankful for it, because it proves things definitely are different today - we haven't experienced global interest rates this low for at least 5000 years.
This is significant because it helps explain why our politicians and econocrats have been finding it so hard to revive economies like Australia's in the wake of the global financial crisis.

All the economic models they've built to demonstrate how the world should work were constructed at a time when global interest rates were higher, and those models are failing them now.

None of their models demonstrate how the world works when global interest rates are this low.

We're in uncharted territory.

(graph - see article)


Read more: http://www.smh.com.au/federal-politics/ ... z3juwN0feI
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[JimC]

I have lost interest in economics. Now I know why...

[Brian Peacock]

Interest rates are no the only thing at an all-time low.

[JimC]

Interest rates are no the only thing at an all-time low.

There's something very Scottish about your phrasing here...

[Brian Peacock]

Interest rates are no the only thing at an all-time low.

There's something very Scottish about your phrasing here...

Ya nay be wikkin ma tallwag weyah smart mooth un fancy troos.

[cronus]

There is another graph. I know it is hard to visualise. What you might call the slight lift before global collapse - all this talk of recovery for a few years that didn't amount to much, is ending. The reason no way ahead appears visible is because we are currently at the high point of the wheels journey. When the roller-coaster starts to slide downwards you'll quickly understand why it appears uncharted territory now - because the ground isn't.

[JimC]

I shall have to start stock-piling gin, enough to ride out the collapse...

[Seth]

Here's an idea: Tell politicians and government economists to go fuck themselves and let the markets control themselves by leaving them the fuck alone. Politicians are what cause this sort of instability. Hang 'em all until they get the message to quit fucking about with our economies.

[rainbow]

[Brian Peacock]

I shall have to start stock-piling gin, enough to ride out the collapse...

Potatoes and junipers is all you need. How's your juniper bush doing btw?

[JimC]

I could have sworn there was no photographer around on that day...