• Entertainment
  • Finance
  • Marketing
  • Real Estate
  • Technology
  • Social
National Journal Community Of e-Experts
Finance 0

Synchronized Global Slowdown On Crushing Debt And Falling Free Cash Flow

By Kurt Osterberg · On April 17, 2018

The Atlanta Fed is out today with its latest mark down in the US GDP growth estimate for Q1 2018:

The GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2018 is 1.9 percent on April 16, down from 2.0 percent on April 10. The nowcast for first-quarter real personal consumption expenditures growth declined from 1.1 percent to 0.9 percent after this morning’s retail sales release from the U.S. Census Bureau.

Here is their chart.

 

Economic growth is slowing, not just in the US, but worldwide. Despite China’s officially proclaimed 6.8% growth rate in the first quarter today, Capital Economics estimates that it was closer to 4.8%, down from around 6% six months ago.

As explained in the latest Q1 2018 Hoisington Quarterly Review, unprecedented debt abuse over the past 8 years is now compounding an economic slowdown globally, while rendering the economy increasingly immune to the efficacy of monetary stimulants in truncating the coming recession. Here’s why:

The fact that there is such a long lag between policy change and economic impact is critical in analyzing the circumstances today. For instance, suppose the Fed is able to identify the next recession on day one. Also, suppose that on the first day of the recession the Fed drops the federal funds rate to zero. Due to the economy’s extreme over-indebtedness, along with long monetary policy lags, a minimum of one and half years could elapse before even a slight economic recovery is experienced. But, recovering from the next recession, the lag could be much longer since interest rates are so close to the zero bound and indebtedness continues to rise to record levels. Both will interfere with the potency of the liquidity effect. Thus, despite a rapid Fed response, a long recession could ensue.

Where savings is present consumption denied, debt is future consumption denied. And here is an updated portrait of the debt now weighing on the world’s future consumption.

Print Friendly, PDF & Email

Share Tweet

Kurt Osterberg

You Might Also Like

  • Finance

    STEPN Sneaker NFTs Sell For $100, Previously Worth $1200

  • Finance

    NFT Prices in Free Fall – 5 NFT Collections to Start Buying Today

  • Finance

    5 NFTs Trending on Twitter Going Cheap to Invest in Now

No Comments

Leave a reply Cancel reply

Top Finance

  • 3 Best Large-Cap Blend Mutual Funds For Enticing Returns 3 Best Large-Cap Blend Mutual Funds For Enticing Returns
  • What is Value Chain Analysis? How to Deliver Value & Gain a Competitive Advantage What is Value Chain Analysis? How to Deliver Value & Gain a Competitive Advantage
  • Hedge Funds In The US Hedge Funds In The US
  • 5 Ridiculously Useful Non-Monetary Reward Examples that Improve Employee Engagement 5 Ridiculously Useful Non-Monetary Reward Examples that Improve Employee Engagement
  • Chart: Amazon’s Dominance In Ecommerce Chart: Amazon’s Dominance In Ecommerce

New Posts

  • STEPN Sneaker NFTs Sell For $100, Previously Worth $1200

    STEPN Sneaker NFTs Sell For $100, Previously Worth $1200

    June 20, 2022
  • NFT Prices in Free Fall – 5 NFT Collections to Start Buying Today

    NFT Prices in Free Fall – 5 NFT Collections to Start Buying Today

    June 20, 2022
  • 5 NFTs Trending on Twitter Going Cheap to Invest in Now

    5 NFTs Trending on Twitter Going Cheap to Invest in Now

    June 20, 2022
  • Bill Gates – ‘NFTs & Crypto Based on Greater Fool Theory’

    Bill Gates – ‘NFTs & Crypto Based on Greater Fool Theory’

    June 20, 2022
  • Actor Seth Green Pays $300,000 to Recover his Stolen BAYC NFT

    Actor Seth Green Pays $300,000 to Recover his Stolen BAYC NFT

    June 20, 2022
  • About
  • Contact Us
  • Privacy & Policy
  • Sitemap
  • Terms of use

Copyright © 2018-2021 NJCEE. All Rights Reserved.