Let’s face it. Over the last time, it is impossible to not notice that the global economy is slowing down. Brexit, the trade war is blamed for it. But is this really what is powering the slowdown of the global economy?
Let’s have a look at what’s happening. First of all, we need to realize that the words being chosen are important. Bureaucrats are talking it down, they are blaming just out of control things which are just caused by politicians. They are not talking about what is really happening.
If we look at the growth in the Eurozone and the United Kingdom we see just a 0,2% economic growth. With the statistical margin of error of 1%, we can simply say that we are in a recession.
The United States is still doing relatively well. But this is mainly due to artificially low-interest rates, unprecedented monetary stimulus. Did the stimulus work? No, to avoid the USA economy completely crashing down we see that the central banks are stimulating again. President Trump called for a lower interest rate. Is lowering interest rate a sign of a growing and well-doing economy?
So what is powering this slowdown? It is said that it is a perfect economic storm. The Chinese economy is slowing down, geopolitical problems are slowing down the economy. But let’s ask one question: is the media and are we discussing the disease or the symptoms?
I’ll be very clear: we are just seeing the symptoms of the world famous boom-bust cycle. Which is powered by the policies from the central banks? Which is just eating our wealth away? The goal of the central banks is not to create economic stability. It is just to create profits for the shareholders.