Five Years Since The Great Financial Crisis: "No Growth, No Deleveraging"

Tyler Durden / ZeroHedge

One of the populist buzzwords of the past 5 years, particularly in Europe, has been “austerity“, which as we have said for the roughly the same past 5 years, is simply a synonym for “deleveraging” but one which carries just the right amount of negative connotations, and is used by crafty politicians to shift blame from their own failure to enact proper policy (which over the past 30 years has merely meant to borrow growth from future political cycles, aka, issue debt) onto a “technical” word conceived by Ph.D.-clad economists, who too, are looking for a passive victim on which to project their failure of enacting a voodoo economic theory. There is one problem with all of the above. As we have also been saying for the past five years, the austerity deleveraging myth is one big lie. We are setting the record straight below with facts and figures. We would be delighted if some politician, somewhere, could disprove these facts, which essentially imply that the world is now in a global recession, having experienced no growth as the recent 100% contractionary PMI print of all major economies confirms, yet without any country actually having implemented austerity, pardon deleveraging to have at least a modest justification for this failure of growth.

Finally, this article proves that the European chorus screaming for “growth” when everyone knows it demands merely more of the same drug – debt - is 100% wrong, and that while the underlying causes of “growth” are there, the only thing missing are the symptoms. DB’s Jim Reid provides the charts and facts:

Figure 37 shows the combined Debt to GDP of the EU-12 (excluding Luxembourg), the US, UK, Japan and Australia. This debt includes Governments, Financials, Corporates and Households. Ireland’s small economy and large financial system (domestic and foreign), ensures an outsized reading which we cut off in the chart.

continue at ZeroHedge:

http://www.zerohedge.com/news/five-years-great-financial-crisis-no-growth-no-deleveraging

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