Economic Collapse Indicators Are Now Coming Together To Form A Perfect Storm

Economic Collapse Indicators Are Now Coming Together To Form A Perfect Storm

IMF reports that the Greek debt cannot be sustained. UK retail sales declined, weather and Easter are being blamed. Homeless school children in the US increased 38% since 2009. The American family is now being economically destroyed. Used car prices are falling which will have an impact on new car sales. Import prices plunge.Everyone is getting out of the market. GDP continually downgraded. IMF warns that the global economy is slowing

Via John Ydstie

So what's going on? Here are five key factors from the WEO.

1. Fallout from the global financial crisis and the Great Recession is still a drag on growth. That's the case in the eurozone, which is still suffering from high unemployment and low investment. The hit to global demand from the Great Recession also hurt big export economies such as China's. Demand hasn't recovered, and growth rates in China have fallen significantly in recent years. However, one positive in Tuesday's forecast is a slight upward revision in Chinese growth for 2016.

2. Demand for commodities from iron to oil has been hammered by the slowdown in China. That's hurt emerging market commodity producers, including Brazil and Russia. Both are already in deep recessions. The IMF now forecasts that their downturns will deepen this year.

3. Political instability is hurting growth in Brazil, Europe and the Middle East. Brazil is embroiled in a corruption scandal at the highest levels of government. Europe is reeling from a migrant crisis caused by conflict in the Middle East. The debt crisis from Greece remains a threat, and the Brexit — the upcoming vote in Britain that could lead to its exit from the European Union — is also creating uncertainty that undermines growth.

4. The strong dollar and weak demand in much of the world are hurting exports and eroding growth in the U.S., which is one of the few relative bright spots in the global economy. Also, low oil and gas prices have curtailed investment in the energy sector. This is continuing to hurt U.S. manufacturers that produce equipment and supplies for the industry.

5. The Federal Reserve hike in U.S. interest rates and the prospect of even higher rates have caused capital to flow out of emerging markets and into dollar-based assets. That has hurt investment in those emerging markets, undermining growth.


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