Writing today, Mike Shedlock notes upcoming prime interest rate cuts by various central banks. Of particular interest is the why of cutting rates. Canada cut because their exports to the US are falling and US exports are a large part of their income. The Eurozone is considering a cut because of the same pressures, with many European employers now threatening to layoff people and move jobs outside the Eurozone. Even Japan, with an interest rate of 0.5% is threatening to cut... to what, zero? Why? Because economic growth is slowing in Japan and Japan exports lots of products to the US.
This raises the question of whether the various economic powers of the world are now prepared to race to the bottom in an effort to support their own economies at the expense of everyone else's economy? It certainly is starting to look that way at this time. But what happens during massive contractions? Certainly not building new infrastructure or large scale capital spending on new and unproven technologies.
Thus, it appears that we are adding another positive feedback loop to the existing ones working against mankind right now. The others are natural cycles altered by man - resource depletion, climate change, topsoil erosion, water table depletion, overpopulation, etc. This new one is a man-made system (economics) again altered by man himself with simple greed and corruption, destroying trust in the underlying financial system at precisely the moment in history when the financial system is most needed to counter the other positive feedback loops.
Italy's Pitchfork Protests Spread to Rome; Interior Minister Warns of "Drift Into Rebellion" - Over the past four days "pitchfork protests" have spread to numerous cities, disrupting road and rail travel in protest at state of economy. The pitchfork ...
31 minutes ago