Global Recession - Is it really Over?

Wednesday, August 26, 2009

The Central Bankers of the world met this past weekend in Jackson Hole, Wyoming. Known for hoards of Deer, Elk, hunters and hamburgers, this relatively small frontier town became the center of the financial world for a few days – and will be widely remembered from this day forth as the place in which the global recession was officially declared over.

Just don’t tell those 14% of industrialized workers who are without work, don’t tell those farmers who are selling items at 2/3rds less than what they were last year because of trade restrictions, and don’t tell the Central Bankers themselves, because in the end – the meeting and declaration was more politically motivated than factually motivated.

Jean-Claude Trichet, the EU Central Bank President, gave a speech that can be defined as optimistic, or if you are one of those protagonists, you could have derived a negative message from him.

Ben Bernanke who heads up the US federal reserve was chipper and growth focused in his remarks – notwithstanding the actual numbers, he used words like “I feel” and “in my opinion” to describe the economic recovery – terms usually reserved for politicians and not numbers oriented Central Bankers. Good for him though as President Obama rewarded him with another term as Fed chairman for his efforts.

The Forex marketplace this week has been slow and light, most everyone is off in some vacation spot, perhaps hunting Deer and Elk or eating burgers. Forex traders have not been moving the markets these past few days – and neither has any news for the most part.

The summer is winding down, quarter 4 is around the corner and the world is anxiously awaiting something to happen. In Europe, Germany’s growth and true recession exit is marred by the other EU countries that are still suffering double digit unemployment and negative growth.

In the US everyone, including the politicians and policy makers are on vacation, trying to regroup and figure out how to spend another Trillion Dollars that they don’t have on a healthcare package. And in China, they are selling their Dollars (shhhhhh).

In a world in which the lines between fact and political fiction, it is difficult to pin just where this economy is going. Yes there is some signs that things are getting better, but there also so many signs that there is bad news on the horizon.

In the past 3 months alone, 650 banks have closed in the EU and US – the pains are still there from last year. Unemployment numbers are still rising – and the politicians warn us this is going to happen for a while longer.

But something is happening, we are reaching a critical point in which something will happen. My belief is that it will not be good, but it can turn out to be positive – the haze of summer is upon us and Forex traders and online Forex bloggers like me are looking for a break in the air – a little clarity – and we are not getting it from those who are charged with honesty and truthfulness.

Keep your eyes open – next week will be a good one for numbers. For this week, enjoy the quiet, it is usually like this before the storm.


john riggley August 27, 2009 at 5:15 PM  

Yes I completely agree , even some would say that it was never here in the first place , but i'm sure there is thousands upon thousands of out of work people that would contest that point.

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