Global Government Debt Crisis Emerging


Global Government Debt Crisis Emerging

Written by Thomas R. Eddlem

New American

18 April 2012

A sugar-coated analysis of the global economy released by the International Monetary Fund April 17 nevertheless contains dire warnings about a world in a looming global government bond crisis.

Though the IMF projects a relatively sunny economic forecast for the United States and Japan over the next two years (along with a debt crisis-driven recession for Europe in 2012), the IMF warns that outlandish U.S. and Japanese budget deficits are pushing economic indicators to the breaking point. “Without more action than currently planned,” the IMF report projects that by next year “debt ratios are expected to reach 256 percent in Japan, 124 percent in Italy, close to 113 percent in the United States, and 91 percent in the euro area over the forecast horizon.” The IMF notes that austerity measures in Europe will cap the debt levels after 2013, while “in Japan and the United States the debt ratios are projected to rise through the forecast horizon, which extends to 2017.”

In other words, the IMF says that the United States and Japan have no plan to ever stem their deficits and record borrowing, creating “latent risks include disruption in global bond and currency markets as a result of high budget deficits and debt in Japan and the United States.” Economic counselor and director of the IMF’s Research Department Olivier Blanchard stressed in an April 17 press conference that the United States and Japan are on a fiscally unsustainable path. “Insufficient progress in designing such a medium-term plan is especially noticeable in the United States and in Japan.”

Click Here to Read More

Advertisements

About partisanrangershow

Freedom fighter
This entry was posted in Economics. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s