A couple of points: Keynes said, apropos the world's economic outlook, 1932, "This is not a crisis of poverty, but a crisis of abundance." Franklin Roosevelt claimed in 1928 that it would take nothing less than the shock of a depression to bring about the rationalization of the U.S. construction industry. Between 1922 and 1929 profitability in the U.S. recovered and grew phenomenally, no doubt triggering the kondratieff long wave upswing popularly known as the great depression and second world war. >Okay, I'll try another scenario (I shouldn't listen to the BBC finance >programmes, they're beginning to sound .. well, so millenial): > >Japan's government is issuing record debt. Long term interest rates are >gonna have to keep going up as a consequence. Makes the Yen stronger. >Japanese business depends an awful lot on exports (its domestic market >suddenly choc-a-bloc with non-consuming savers), but money's getting dearer >for it and a strong yen makes their exports dearer while the Yanqui CAD >blows out even further and people dump the greenback to follow the Yen and >the Euro to artificial highs. > >Greenspan ups the interest rate there to protect said greenback. >Debt-financed stock speculators start shuffling out, mebbe with Japanese >government paper in mind. > >And then Y2K kicks in - not necessarily as a technical problem, but as a >sociological phenomenon. Better to have real greenbacks sitting idle under >the bed than trying to accumulate in unreliably digital form - and isn't so >much of that high-tech stock on the Nasdaq more likely than most to cop the >slings and arrows of outdated fortunes - what with possible liability for >whatever technical problems do arise? And the possible tank on the Nasdaq >is huge - there's just no comforting reference point, is there? > >Does any of this hold up? > >Cheers, >Rob. > > > > > regards, Tom Walker
