I don’t want to be seen as scaremongering but believe me history tells us that we have not learn t from our past mistakes, instead we seem to reward the banks for the recession they have caused eight years ago, seriously what is wrong with us?
“… in particular the combination of cheap credit that increased demand for debt along with general increase in the appetite for risk by potential lenders” (The globalisation reader. P. 210). You see how the 2008 recession occurred is basically pretty simple to explain; the banks created too much wealth which meant loans are available to be taken and every time a loan is taken banks make money and this eventually has left people in too much debt that they became unable to pay back. The point here time and time again we see banks getting away with everything as if there aren’t any rules for them to follow or act on.
In Inside Job-a film that exposes the corruption of US which caused the 2008 crisis, some of the speakers admit that the banks knew what they were doing and we are already seeing signs that the global economy may have reached its peak; for instance, commodities have plummeted to lows not seen since 2002.
Additionally, the Chinese economy is in deep trouble with year on year exports as well as imports in negative. The thing with china is that they depend a lot on foreign trading so that means they export to Latin America, Africa, middle East and Europe. According to an article published by the Guardian, Luo Dong, the owner of Doyoung, a Beijing-based exporter of frozen seafood and fruit blames the central of Europe for deliberately down the value of the single currency by implementing quantitative easing. Forget about trading with China or other parts of the world, the Eurozone faces its own challenges as we have seen the rapid rise of Greece’s Podemos as well as the great support that many so called lefties in Portugal, Spain and Italy are gaining; just imagine the extent to which an exit of any of these countries would have on the Eurozone. Europe needs strategic direction but this time that should not come from the so called “experts” in financial sectors or politicians who were once bankers.
Even though it’s hard for ordinary citizens like myself to understand or know when a crisis is about to take, we can nevertheless learn from our past mistakes. Below I have shared videos that would explain how inequality takes place and the wealthy keep getting richer, I am hoping that if we watch videos like this we would have some idea of how banks work. in addition, we have to have alternatives to organisations such as the IMF because clearly they have not achieved their objectives rather we see greater inequality being born out of their ideas in many of the developing countries and it is also important than they also provide protection for their own economies when the next financial crisis hits the world again!
2014. The Globalization Reader. 5 Edition. Wiley-Blackwell.
The Guardian. 2015. The global economy is slowing down. But is it recession – or protectionism? . [ONLINE] Available at: http://www.theguardian.com/business/2015/nov/14/global-economy-slowing-down-recession-or-protectionism. [Accessed 08 December 15].