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BEGINNING OR THE END?
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AseanAffairs Magazine March - April 2011
CONTENT • ASEAN TECH
• ASEAN CORPORATE STRATEGY • ASEAN TRAVELLER
• ASEAN ENERGY

• BEYOND ASEAN

• ASEAN ENVIRONMENT INSIDE OUT
• ASEAN MONEY  • THE AWAKENING
 • ASEAN TALK      • SAVE OUR PLANET IV

 

 

A NEW REALIGNMENT or CONTINUING CHAOS?
Managing Editor David Swartzentruber sees a new global political restructuring as the answer to the current global chaos.


COVER STORY   Read More... 

Testimonials – What our Readers are saying about us
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Global economics

Q: Would you like to be wealthy?
A: Yes

Q: Would you like to own a home or perhaps several homes?
A: Yes
Q: How about a vacation and/or retirement home on top of that?
A: Yes and yes This dialogue indicates what apparently occurred many times in the U.S. financial system during the first decade of the 21st century. The building of homes stimulated the national economy and everyone was happy until 2008.

In previous U.S. generations, most families had to save their money, started off by renting a home and by the time their children arrived, the amassed savings went to finance a simple “starter” home.

In recent history, banks, mortgage companies and allied financial institutions became not just processors of home buying transactions but dream sellers. They tapped into the magical part of the human psyche that with little effort, one’s dreams could come actually true as opposed to previous generations that had obtained their home through hard work and amassing savings.

As we live in an interconnected global financial system, the crisis spread rapidly throughout the world, triggering dramatic actions by central banks where in the west, the talk is now of deficits and debt, while in Asia’s emerging economies, it’s about accumulating capital.

For more on debt and other seminal issues read the Anonymous American’s article later in this issue.

Mohamed El-Erian, CEO and co-chief investment officer of the U.S. investment company, Pimco, has coined a new term, the “New Normal” to describe the present economic scene of lower investment returns, slower economic growth and greater risk. As Federal Reserve Chairman Ben Bernanke said the economic outlook is “unusually uncertain.”

He anticipates, as many others do, a migration of growth and wealth from the western industrial world to “the larger emerging economies.”............

“[I’ve] been selling Treasurys because they have little value within the context of a $75 trillion total debt burden,” Bill said. “Unless entitlements [namely Social Security, Medicare, and Medicaid] are substantially reformed, I am confident that this country will default on its debt.” Klaus Schwab, founder of the World Economic Forum (Davos) said: “Humanity is at a crossroads. We can either continue to work as lobbyists for our narrowly defined self-interests and keep doing the same old things that got us into the crisis in the first place,” or we can “act together as true global leaders, with the longterm global public interest in mind and at heart.” “In the ‘Nike Economy,’ there are no standards, no borders and no rules. Clearly, the global economy isn’t working for workers in China and Indonesia and Burma any more than it is for workers here in the United States.” “I am confident the Federal Reserve can and will tighten policy well in advance of any threat to price stability, and successful execution of this exit will demonstrate that these emergency steps need not lead to higher inflation.”

 

 

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