Markets crash signals end of capitalism – economist
5 Aug, 2011 17:19
With world markets remaining unstable after the sharpest fall since 2008, economic analyst Michael Mross declared that this nosedive has not been a “normal” crisis.
Global markets are struggling to recover following a worldwide plunge spooked by the weakening US economy and the situation in euro zone.“This is not a normal crisis,” Mross told RT. “And this was not a normal crash that we had this week. It was the beginning of the end… and will spell also the end of capitalism in my view.”He says the market panic was triggered by politicians who are not dealing properly with debt.“What is the illness that has triggered all these problems?”, he rhetorically asked. “The illness is called ‘debt.’ All Western nations are in debt. They lose their credibility. And what happens when they lose their credibility? Then banks are going bankrupt.” Mross believes that politicians in Brussels will now do everything in order to prevent the euro from collapse, because if the currency breaks up, a worldwide crash will be inevitable. “I think politicians in Brussels will do everything in order to avoid a break up of the euro,” Mross predicted. “If the euro breaks, then this will trigger the end of the capitalistic system. Then we will have a worldwide crash. This is already the fear that is in the markets.” And as the fear is growing that the US will go back into recession, affecting not only the US but the entire world economy, Mross said that he cannot see a solution to the US economic problems, as producing more debt is in itself the central issue of the ongoing crisis.Mross believes precious metals may be a solution that average people can rely on. “What I can give in terms of advice to everybody is to check out if he has enough precious metals, buy some gold, buy some silver. Spend your money as long as you get something for it,” he said.Jeff Steinberg, a senior editor at the Executive Intelligence Review Magazine, says the US and European crises are now intertwined and without a fundamental bankruptcy reorganization, there is no hope for the entire transatlantic system to recover.“It is a single transatlantic crisis that will not be solved within the terms of the current system,” he said. “The big six New York banks are sitting on $1.6 trillion in Spanish and Italian debt alone.”He believes the current economic situation will be remembered as being worse than the Great Depression.“The big New York banks are facing worse volumes of non-performing toxic assets now than they had at the time of the collapse of Lehmann Brothers,” he said. “There has been no real recovery since that point.”“The banks are, in fact, helplessly bankrupt,” he stated. “There is talk here in Washington that Bank of America and Citigroup – two of the largest of the big six – are in desperate straits.”