World economy is sleepwalking into a new financial crisis, warns Mervyn King

Captioned article states that we’re currently unknowingly entering financial crisis that will have devastating consequences on our democratic market system.

It mentions that we need to adopt new way of thinking, otherwise we’ll be facing the same crisis as 2008. If the U.S now do not have the necessary firepower to deal with another episode similar to the sub-prime mortgagr sell-off which caused the 2008 economic meltdown, they’d be in for a “financial armageddon”.

This is especially so since we are living in an age of political turmoil – US – China Trade war, riots in HK, emerging countries issues with Argentina and Turkey, tensions between France and Germany (+couple of others which I can think of myself for now – Korea Japan mini trade war, Italy’s plunging economy, Germany’s negative yield bonds, Chile’s rioting etc.) – to top it off, the increasingly bitter political conflict in the US at a time when the willingness of the US to act ad the world’s policeman disappearing – can seriously harm the economic climate now.

King also admits that he feels its time for the Fed and other central banks to begin talks behind closed doors with politicians to make legislators aware of how vulnerable they would be in the event of another crisis.

Winter’s coming all.

Source:

https://www.google.com/amp/s/amp.theguardian.com/business/2019/oct/20/world-sleepwalking-to-another-financial-crisis-says-mervyn-king

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