Just like the song, what's going on with the world's economy?
It’s been almost eighty years since the economic world has encountered a situation like this, foreign presidents are stating that the worst has passed, and things are going to be better from this point on. My main concern is not how to get out of this crisis but why did it start in the first place, its fair to say that the deregulation of the financial and housing market played a major roll in this incident, but is that a good enough answer? Is that the root of the problem? What are the market rules for this century? All of these questions are not easily answered; it takes time and a learning curve to comprehend the truth, whatever that is. Mark Twain once said, “History doesn’t repeat itself, but it rhymes”. This can be a beginning point to respond some of these questions; we are applying old rules to a new game, a much faster and riskier one. One thing is for sure, the growth by easy credit system is a fallacy, and the American economy has proven that, look what happened to its economy since the Reagan years, bubble after bubble, and each time with a bigger burst, causing herculean externalities everywhere. Peter Senge says: “There is no easy answer for true questions”, and economist love to predict and criticize everything (its what they do), maybe the best way to deal with this new economy is to apply common sense, study your past, analyze the present, and build your future.
