Global economy in need of rescue

THE spectre of debt is halting an economic revival and there appears to be no obvious solution, an economic journalist has warned a local audience.

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THE spectre of debt is halting an economic revival and there appears to be no obvious solution, an economic journalist has warned a local audience.

Philip Coggan (pictured) is a regular columnist for The Economist magazine and was in the island for a conference organised by training provider BPP. He has written books about the issue, but even he admits that the resolution is unclear.

His view is that either the world must suffer prolonged stagnation – a fairly close summary of the current position – witness massive defaults, or the accumulated debts of the past years must be inflated away, difficult to do in the age of the euro, with many parties trying to prop up the single currency.

‘There is too much debt and we cannot pay it back,’ he said.

‘Something has to happen. Five years since the crisis started and we still haven’t solved it because people cannot pay debt off in real terms. The thing with debt is that someone must lose – you cannot deal with debt without someone losing.'

Comments for: "Global economy in need of rescue"

Town Dweller

It's just a shame so many so called 'finance professionals', were so busy with their noses in the cash trough, they failed to see this coming.

Or I suppose they were just willfully blind, as they like to say now. Shouldn't complain, as the Island is now full of over-sized 4x4s bought on the back of this amateur financial mis-management.

Backchat

We will be unaffected by this, as the States have been telling us we are fine and the global recession has not made any difference locally and they continue to spend our money like pouring water.

The American economy is about to fall off a cliff, watch how it effects us and it will.