Will Economic recession last 2009 - An analysis

The global financial and economic crisis continues to worsen. A few
weeks ago, the giant Citibank was bailed out several hundred million
dollars in cash and guarantees the U.S. government ( "Citi never
sleeps", but apparently managed to sleep out of some of the important
decisions in the past year).


Last week, America in November, reported a loss of jobs to more
than 530,000, the highest single month since 1974, taking the U. S. The
unemployment rate up to 6.7 percent, the largest in the last 15 years.


EU, euro zone, Japan and Britain are now officially in recession,
in the sense that they had two consecutive quarters of negative
economic growth. Some analysts predict that the pace of decline in the
U.S. economy in the last quarter of 2008 may be surprised at an annual
rate of 4-5 percent.


A similar pessimism pervades the other two largest economies in
the world, Europe and Japan There is considerable uncertainty about the
depth and duration of the current global recession. However, the
majority view of experts is now an important opportunity this will be
the worst recession since the Great Depression of the 1930s.


A serious financial crisis and the huge collateral damage to the
real sector of the economy of shame optimistic last year. Often,
experts argued that the "worst of the financial crisis is behind us,"
only dead in bushes next big mortgage refusal or withdrawal of credit.


Equally remarkable, and much worse in the impact was the speed
with which the accumulation of financial crisis Throttled to real
economic activity, since the summer of 2008. Rapid onset of recession
in the industrial sector (advanced) countries has exceeded the forecast
ability of many institutions, including the IMF.


More recently, in July this year, the IMF predicts that global
economic growth, 3.9 percent in 2009, with developed economies to 1.4
percent in developing countries by 6.7 percent. In early November
(after only four months), these forecasts have been reduced by 2.2
percent, minus 0.3 percent and 5.1 percent respectively.


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Their forecasts for economic growth in the U. S. In 2009, the Fund
spent more than 0.8 percent in July, at least 0.7 percent in November!
And it is safe to bet that the IMF has undertaken a series of new
forecasts for 2009 today, all these numbers would be even worse.


None of the recent "release" from a global perspective, in 2009,
provided they do not UNCTAD. Like the IMF, UNCTAD, the expected global
growth of just over 2 percent in pesos in 2009 and the PPP, only 1
percent in the exchange market. The second number means that the
overall growth in 2009, is expected to be only a quarter of people who
have the pace in 2006 and 2007

Present economic crisis and the Great Depression

The Great Depression of early this century left a mark in the world that continues being
today, almost 80 years after its beginning. They started the creation of
our present banking system, moulded our laws of values, and left marks in
psiquis of the nation that have disappeared with the only modestly
decades. During the Depression, the economizers saw evaporate their
bottoms in the banking bankruptcies, because the deposits that were not
assured. Bankers got to be so unpopular that asaltabancos, as Bonnie
and Clyde, became popular heroes. In the depths of the depression, 25%
of the population outside the work. The industrial average Dow Jones
had fallen 89%. All the banking system was closed during four days by
presidential order. House and the farm of the mortgages goes out.
People without created home enormous quarters, call " Hoovervilles, "
outside the majority of the main cities.

What makes it sound like the current situation?

Few deny, however, that the current economic climate is worrying similarities with the Great Depression:

• The large decline in the stock market fell wealth and reduce costs, said Timothy Canova, deputy dean of international economic law at Chapman University School of Law. Dow did not fall steadily: it sank 47% from its peak of 381 in September 1929 to November 1929, and then began the famous "sucker in the rally" in the spring of 1930, before falling to 41 in July 1932.

• The banking system was paralyzed on loans and speculation. In 1929, loans were actions of speculators, most recently, loans have been the owners and investors in mortgage securities.

But there are some big differences that make today, repeating the Great Depression is unlikely. The biggest: the massive intervention of central banks around the world. "The Fed has been very aggressive and its role as lender of last resort," said Paul Kasriel, chief economist at Northern Trust. That is why the Fed was created - to prevent economic recession, but to prevent the implosion of financial systems. "