Global Depression Coming (?) – Even “Powerhouse” Germany and UK Slow “Dramatically”

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We added the question mark to the above headline from Zerohedge. We think such a depression is entirely possible, perhaps beyond possible. But regardless there are serious shudders moving through the world economy right now and we are deep into the current “expansion.”

So what happens when a recession happens when we are already starting from a lower baseline? Well, you know what happens. Things get ugly. And this time the geopolitical stakes are higher than they were in 2008.

(From Zerohedge)

Just this week, we covered the similar starking warning from the BIS, the central bank of central banks,  who warned of “major fault lines” in the global financial system and a “global debt bubble.”

Right on cue yesterday figures out of “powerhouse” Germany show a dramatic and unexpected decline in economic activity. Imports and exports slumped in the month – with exports slumping 5.2% in August relative to the previous month. At the same time imports into Germany are also faltering with the most recent figures showing a decline of 3.1%.

Germany’s manufacturing industry, Europe’s biggest industry in the EU’s largest economy, is taking a hit from sharply slowing demand in emerging markets and developing markets….

…Their figures indicate that the UK economy is growing at 0.3% down more than 50% from the rate of growth in the second quarter.

“Weakness is spreading from the struggling manufacturing sector, hitting transport and other industrial-related services in particular. There are also signs that consumers have become more cautious and are pulling back on their leisure spending,” Chris Williamson, chief economist at Markit, said according to Reuters.

Click here for the article.