Head of World Bank warns markets have entered new danger zone
The loss of market confidence in economic leadership in key countries like the United States and Europe coupled with a fragile economic recovery have pushed markets into a new danger zone, something that policymakers have to take seriously, the head of the World Bank said on Sunday. Speaking at the Asia Society dinner in Sydney, Robert Zoellick also said the global economy was going through a multi-speed recovery, with developing countries now the source of growth and opportunity. “What’s happened in the past couple of weeks is there is a convergence of some events in Europe and the United States that has led many market participants to lose confidence in economic leadership of some of the key countries,” he said. “I think those events combined with some of the other fragilities in the nature of recovery have pushed us into a new danger zone. I don’t say those words lightly… so that policymakers recognize and take it seriously for what it is.” Zoellick said the process of dealing with the sovereign debt problem and some of the competitive issues in the euro zone have tended to be done “a day late,” leaving markets worried that authorities may not be ahead of the problem or moving in the right direction. “That (worry) has accumulated and so we’re moving from drama to trauma for a lot of the euro zone countries,” he said. On the United States, Zoellick said it wasn’t fears the world’s biggest economy faced an imminent problem, but “frankly that markets are used to the United States playing a key role in the economic system and leadership.” He said efforts to cut U.S. government spending have so far been focused on discretionary spending as opposed to the entitlement program such as social security. “Until they make an effort on those programs, there is going to be continued skepticism about dealing with long-term spending.” Zoellick said while market confidence has been hit, the real issue was whether this will spread to business and consumer confidence, something that was still unclear. –Reuters
Shared with this Ministry in 2007: So how is Father using Her power to alter the thinking of Satan’s rulers in these end times? And what effect will it have in the coming months?
China is holding more than one trillion in U.S. currency debt. And even though China is presently benefitting from trade with the United States, she has a bur in her side over the Republic of Taiwan. The U.S. continues to commit herself in weapon sales to Taiwan. Because of this ongoing aid to that country, China will put aside profitable trade relations, seeking to devastate the U.S. economy by dumping the U.S. debt it holds on the world market. When this occurs, it will cause a sharp devaluation of the U.S. dollar, and there will be a loss of faith by the world community in the United States economy. Even though this would cause a loss to China on their investment as well, they feel their own economy can withstand the harm that would result from such an action in breaking the financial back of the United States. However, this action would affect only approximately 3 percent of the U.S. economy, but with other factors involved, such as the amounts of debt to finance the Iraq and Afghanistan conflicts, and the ever growing national disaster relief funds, the United States will feel the quake of such an action on China’s part. Next, Father will motivate the leaders of OPEC to change and price oil in Euro Dollars. This will be because the confidence once felt in the U.S. will have taken a drastic change for the worse.