Global Economic Crisis

In a recent edition of the Australian newspaper, The Sydney Morning Herald, business blogger  James Adonis presented the views of seven financial thinkers on what the next stage of the global economic and financial crisis might entail. Not surprisingly, there were optimists in the group. There were also pessimists, including your’s truly. Here is what I told James Adonis, and appeared in The Sydney Morning Herald:

“But Canadian economic commentator, Sheldon Filger, disagrees. He predicted the global financial crisis two years before it occurred. ‘Policymakers in major advanced economies have made a gamble; absorbing massive levels of public debt to backstop insolvent banks and fund stimulus spending… They will lose this gamble, I am convinced, sparking a massive sovereign debt crisis in these economies, especially the US and UK, unleashing a synchronised global depression. What is unfolding now in Greece and the other PIIGS is but a harbinger of what is to come. I predict that round two will unfold by 2012.’ ”

In the months prior to the worsening financial situation in the United States combusting in 2008, there were plenty of prognosticators. The closer one got to official government circles and mainstream media, the more upbeat and positive the forecasts became. It was in the area of unofficial sources where one encountered the most accurate prediction of what was to unfold. I recall how NYU professor Nouriel Roubini came out with a checklist of what would unfold months  before the collapse of America’s major investment banks. He was pilloried as “Dr. Doom,” while those who abstained from drinking the official Kool-Aid  marked off his checklist with an uncanny lack of interruption, as the global financial system headed towards catastrophe.

My views, as expressed in The Sydney Morning Herald and elaborated on in detail in my book, “Global Economic Forecast 2010-2015: Recession Into Depression,” are presently far from the perspective of officialdom, policymakers and mainstream media pundits. Yet, as major economies sink deeper into irreversible public debt, and sovereign debt crises have emerged in Greece and Dubai, I have begun to mark off my own checklist, as the global economy  accelerates on the road to fiscal calamity.