People ask, more anxiously than in ’08, “Will there be a depression?” in the same way that they asked in the ’30s “Will there be a war?”
This links to twenty-plus minutes of predictions by a Swiss hedge fund manager, Felix Zulauf.
“The periphery goes into depression. When you look at a country like Greece, it’s now been in recession for three years. GDP is probably down 15% from the top. The stock market is down 90%, which is the equivalent of 1929 to 1932 in the US. This is depression-like. Then I expect next year one country, probably three, will exit the euro. That will make 2012 very interesting because there are no rules on how to exit the euro. A country exiting the euro means the next day, when they exit, their banking system is bust. That means the banking system has to be immediately nationalized in a new currency. They introduce a new currency, they nationalize the banking system, and then, of course, the government is also bust. Then the government will default. That’s what you have to expect next year. I think Greece will do so and Portugal and Ireland are candidates also.”
The interview takes a while to load and you have to listen at the beginning to the appalling voice of Eric King.
Drawing by Thomas Derrick probably in Time and Tide, and in that case probably December 30 1933.
January 1 2012 at 12:46 am
A touching drawing, I think.