Don’t let money rule your world

Dec
12

The world’s top industrial market economies are increasingly finding themselves in a recession, or about to tip into one. The collapse of the U.S.’s financial market has spread far beyond American shores, resulting in bankruptcies, forced mergers and massive job losses around the globe.

This financial crisis, which is likely to continue over the next year, just won’t seem to rest until it brings the whole world down with it.

Iceland

Iceland has been hit particularly hard this past month. The New York Times said in a November 8 article, “Like a bad dream, Iceland has now awakened to find that it is all coming true.” The collapse of Iceland’s banks; the drastic currency drop; mass layoffs; and a tarnished reputation abroad; the city of Reykjavik, which is home to two-third of the country’s people, has gone from boom to crash.

Prices have soared; companies are having trouble doing business abroad; people have lost their savings; and inflation is at 16 percent and rising.

According to an October 15 Forbes article, “Icelandic banks relied more than most on cheap debt and sloshing liquidity to sail abroad and conquer the world. The result was a ballooning financial sector that far exceeded Iceland’s own gross domestic product, making it impossible for the state to do much more than seize and protect its banks’ domestic operations when the market crisis hit.”

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Canada

In Canada, unemployment has risen and Ontario’s manufacturing sector has claimed about half of November job losses. The unemployment rate has risen to 7.1 percent. With energy prices falling, a usually prosperous Western Canada has also been cutting back budgets and postponing projects.

Consumer spending has dropped drastically. 70 percent of all job losses have been in the service sector, particularly in retailing, and hotel and restaurant employment.

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Japan

The AFP says, “Japan, which is in the midst of its first recession in seven years, ran up a deficit of 131.9 billion yen in the balance of trade in goods and services, reversing a year-earlier surplus of 96.1 billion yen.”
Whereas Japan can usually count on its exports of electronics and cars and other goods, it too has felt the impact of weak demand from recession-hit economies.

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China

Despite China’s accounting for one-third of global GDP growth in the first half of this year, its economy is struggling, mainly due to the decline in overseas market (i.e. the U.S).  The U.S. essential funds a large part of the Chinese economy so as American wallets tighten so does the flow of cash to China.

According to a Herald Tribune article on December 5, “The World Bank cut its growth forecast for China last week to 7.5 percent in 2009 from a 9.2 percent estimate in June, citing a slowdown in domestic investment and exports. CLSA Asia-Pacific Markets estimates the economy could expand by as little as 5.5 percent next year, the least since 1990.”

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8 Responses to “How the Recession is Affecting Economies around the World”

  1. cheryl Says:

    very good article.

  2. Paul Says:

    How about Europe? Russia? South America? Africa?

  3. DemoGeek Says:

    How about India? (the next on line to China). India’s economical boom was based on the US’s as well for the most part. Any words on India’s state in this turnmoil?

  4. Anoop K Joseph Says:

    India’s Conditions is Slightly
    getting better.

  5. Uncle B Says:

    The Americans were caught with their hand in the cookie jar! They are little better than crooks and thugs! The OPEC folks and the Saudis no longer trust the American sawbuck, and are looking to the Euro, so are the Chinese and Russians! Dishonest business practices abroad are one thing, the thievery at home has left American folks with foreclosures, unemployment, and rising oil prices coupled to a military/defense runaway cost plus situation! Personal credit in the U.S. is at an all time high and is forced ever upward by a senseless psycho-consumer mentality! The (GRD) great republican depression is upon us and we will bay for the Bush follies for a long long time! Re-definition of the “American Dream” and other more drastic paradigm shifts in social philosophy are about to wrench the soul of the American people and all western civilization for that matter! The base, capitalism, as we know it will not survive! Oil in the middle east is running low, and our very lifestyles are based on cheap oil! We are soooo f**ked!

  6. jesse shutiak Says:

    put on thw web site how the economy is affecting mexico canada and the u.s. or your sight will suck.

  7. dont wanna say Says:

    wow uncle B, you are very…

    *the rest of this comment has been censored for the viewers’ benefit. Have a nice day!*

  8. concerned Says:

    Wow jesse shutiak, your spelling sucks.

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