02/06/2012
Instinct is not ever to be dismissed out of hand. And, relying on that, but with a lot else, I was pointing out
on Thursday that it was looking like the end game. Now, we have a bit more to rely on. Robert Zoellick, head of the World Bank until the end of the month,
is warning that financial markets face a rerun of the Great Panic of 2008.
This was after what has been called the "bleakest day" for the global economy this year, when a raft of dismal economic news from around the world wreaked havoc on the financial markets.
Not content with that, Zoellick opined that Europe was heading for the "danger zone", saying that it was "far from clear that eurozone leaders have steeled themselves" for the impending catastrophe.
Zoellick thinks that the coming months could be as bad as the build-up to and aftermath of the collapse of US investment bank Lehman Brothers in 2008. "Events in Greece could trigger financial fright in Spain, Italy and across the eurozone",' he says. "The summer of 2012 offers an eerie echo of 2008".
And, while we have all been worried about "contagion", the
Independent is warning about "contamination", telling us that eurozone woes were contaminating powerhouse economies in the United States and China.
I am not sure that is exactly the case, but there is no denying that both the US and the Chinese economies are under stress â to say nothing of India and, of course, Japan.
Echoing Zoellick, Jason Conibear, a director at forex specialists Cambridge Mercantile, says: "A few months ago the feeling was that a strong China and resurgent US would steer the eurozone through its current plight. Now the fear is that these economies could themselves be sucked into the rapidly spiralling eurozone vortex".
He then adds: "The global economy is in a seriously bad way and we're running out of options to turn things around".
If that wasn't enough, the
Financial Times is also parking itself in the business lounge, ready for the flight to Armageddon. The impact of Europe's inability to sort out its problems is clearer by the day, it says. And the diagnosis is indisputable: "the entire world is now contaminated with the eurozone virus".
A word from
Reuters completes the picture. It cites Joshua Shapiro, chief US economist at MFR, a global consulting firm. "I don't think we were ever out of the woods", he says, "but people got very optimistic earlier this year. Now, reality is setting back in. We've got a tough road ahead".
It really does not get much clearer than that. Yet, sadly, as the countdown to collapse continues, the British media is obsessed with the jubilee "celebrations". But, by the time the long holiday is over and people return to work â those who have jobs - there may not be much left of an economy to go back to.
Actually, it takes a little bit longer than that to engineer a global collapse, but the signs are there. Now might be a good time to panic, even if it's just for the practice. It may well come in handy some time real soon.
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