Global Markets Feel The Pinch As US Mortgage Crisis Spreads

August 13 2007 by The Systemic Analyst.

Gulfnews.com reported last week that:

“The unravelling US subprime mortgage market is causing other markets to fray around the edges faster than anyone expected.”

Of course, ripple effects from American economic woes should be anticipated just about anywhere on the planet - such is the nature of globalization and increased centralization of just about everything that can be governed. This unfortunate consequence, however, should come as no surprise.

What should come as equally unsurprisng is to what very serious degree the U.S. economy is in trouble. Indeed, Martin Hennecke of Tyche Group recently commented in a CNBC-TV18 interview that:

“the US problems that we see in the sub prime market are not limited at all to the sub prime. It’s not just the housing problem. The US economy as a whole has been completely hollowed out over the last 20-25 years and it’s in disastrous shape. So we expect an absolutely massive financial crisis out of the US, perhaps something as you had seen in 1929 or perhaps worse, because this time even the government is struggling to actually pay their debt.”

If these projections are at all accurate, oil and stocks plummeting might be the least of our concerns. Often it isn’t the economic depression that leaves the lasting mark on society, but how society crawls out of that depression. This appears to have been the case with the Great Depression in the 1930’s, brought to an end by an equally great (as in terrible) war.

We are clearly living in interesting times.

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