Shock and … awe shucks: The Fed’s out of ammo, and global liquidation looms
Despite the Reserve’s decisive action it has failed to calm the markets and now it needs stronger weapons
The world’s central banks have exhausted almost all their usable ammunition but have failed to calm markets or halt seizure in critical parts of the global financial system. This is what we all feared.
The danger now is that the deepening global recession – we are weeks into it already – will morph into something more intractable: a deflationary depression with a wave of defaults that effectively breaks the capitalist system as we know it.
So what can now be done?..