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OECD economic outlook



April 02, 2009 – Comments (4)

Naked Capitalism has a post on the OECD economic outlook and wow:

The 30-nation Organization for Economic Co-Operation and Development (OECD) said member economies would contract -4.3 percent this year. That was sharply down from its last forecast of -0.4 percent, made in November.

"The world economy is in the midst of its deepest and most synchronized recession in our lifetime caused by a global financial crisis and deepened by a collapse in world trade," the OECD said in its interim economic outlook.

Amazing to be changing their forecast 10-fold in terms of the contraction they expect.

Seems they think Canada is in better shape.  I think so as well, but Canadian political leaders are quickly destroying Canada's stronger foundation.  What Canada has going for it is that we reduced debt in the easy money years and that was huge, but with moron leaders that seemed to have gone to the same school of screw-the-world-with-bad-fiscal-policy and the weight of the US being our largest trading partner, well, I think of our political leaders as beating on our foundation with sledge hammers along with the other world events and I am not so sure what Canada build can bring us through such incompetence.

 Anyway, the link is a good read.

4 Comments – Post Your Own

#1) On April 02, 2009 at 9:01 AM, dwot (28.84) wrote:

Here's another awesome post from Big Picture.  This is from the bottom and I have certainly voiced the opinion that they committed a mass fraud on the world:

Are the CDS Contracts of AIG Really Valid?

The key point is that neither the public, the Fed nor the Treasury seem to understand is that the CDS contracts written by AIG with these various non-insurers around the world were shams - with no correlation between “fees” paid and the risk assumed. These were not valid contracts as Fed Chairman Ben Bernanke, Treasury Secretary Geithner and Economic policy guru Larry Summers claim, but rather acts of criminal fraud meant to manipulate the capital positions and earnings of financial companies around the world.


And now paying for the fraud has been parked on the backs of taxpayers.

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#2) On April 02, 2009 at 9:04 AM, dwot (28.84) wrote:

And on another point, if you look at how much of the earnings came from this crap, well, by the time it all settles my estimate of the true earning power of the financial companies is about 10c on the dollar compared to what the manipulation was doing.

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#3) On April 04, 2009 at 3:02 AM, sumbawa (30.18) wrote:

Another reason CDS contracts may not be valid: the underlying "assets" (mortgages) were fraudulent and known to be so. That's the argument of William Black, now an Economics Professor, who worked as a regulator during the S&L crisis:

The Two Documents Everyone Should Read to Better Understand the Crisis


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#4) On April 04, 2009 at 3:16 AM, edbbear (< 20) wrote:

Good point dwot--and also troubling thing is that most of those CDS holders didn't even own the underlying assets.  Of the $100 billion that was doled out to Wall St. from AIG, how much of that really offset credit losses and how much were just derivative gains? 

My anger towards Wall St., the investment banks, and Geithner and Paulson is still burning strong, as it has for months.  I just hope that many of those people will be exposed and sent to prison.  Goldman among others should be forced to return those monies. 

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