On the upside I don't worry about saving for retirement because I don't think that I (or a great many many people) will live through the coming cataclysm to see it.
It important to note, that, averaged over multiple decades, it only takes a growth rate of about 1% to lift a country out of poverty.
We would probably do better to focus on fixing the political logjams, corruption, small-scale conflicts, etc, that act as a brake on growth, rather than financial market tweaking.
Then there's the problem of governments debt, which historically has been reduced much more by growth than by imposing austerity.
The world is doing better than it ever has, innovation has been steadily picking up, especially in the United States and in China. Just look at the amount of disruption in so many industries e.g. Taxis, Hotels, Office space, on and on. Even if Chinas economy isn’t doing great right now these things move in cycles. Poverty is significantly dropping across the whole globe and ultimately I think the future is much brighter than it is being painted by these pessimistic academic types that have suddenly lost their clout as people start to value real experience more.
Individually Inequality are at their highest point in recent history across many nations. You say many of them are from an ivory tower, while others would argue you view the world from an ivory tower as well. Their lives are not better, not even back to pre 2008 level, while many would say the "world as a whole" are better off, do those people at the bottom or disappearing Middle Class actually cares if you lift poverty from the rest of the world? Well actually they do if you ask them, just not at the expense of their quality of life.
And the current economy barely holds itself together with low interest rate. But what happen when something breaks again? You are right they really don't know shit, because when it breaks they know they have limited tools to combat whatever that is left over.
Also, 2008 is a ridiculiously short time period to be looking back on and saying things are going down hill. For all intents and purposes we're still in the same time window we were in 2008. World history happens over decades and centuries, not 11 years.
If the middle classes of the western countries are destroyed in order to make this happen then no this is not a good thing at all. The result of that is effectively feudalism.
I tire of this very rarely being addressed. Both in boom and bust everyone is busy looking everywhere but the one single (central) policy that affects the value of half of every transaction conducted in an economy.
And GDP is overstated by the error in the proxy metrics for inflation (e.g. CPI) which I believe this is larger than most people estimate.
I think that aliens would probably look on us much like we look on microbes in a petri dish. Ignoring the paper money there is energy and right now the taps are open and the oil is flowing. Thanks to fracking America now exports oil and we are not in some Mad Max world where oil is a scarce resource hoarded by those that have got it. The Peak Oil people were scared of twenty years ago is but a distant memory of a future that never happened.
The 2008 QE printing of money kicked the can down the road. The reckoning still has to happen, capitalism cannot eat itself forever with GDP that is more to do with cannibalising industrial capitalism and becoming finance capitalism.
I could imagine you may not understand the cause of economic cycles. As you say in the “real” world, you only notice the lived experience of macroeconomic policy, which is what matters from a governance perspective. That’s why politicians talk about “kitchen table” issues to keep popular sentiment but govern through a seemingly backroom set of central bank, tax and trade policies.
It’s not complicated to see that the GDP will grow proportionally to the deficit growth and shrink proportionally to deficit cuts. That extra money is borrowed from the future and injected into today, goosing GDP.
Then the debts get expensive as capital gets tight, interest rates rise and the weakest businesses go under, contracting spending and destroying money as cancelled debt, tightening capital more and consumer confidence. And them the economy shrinks again.
It’s great when the central bank is buying the drinks but the party will end when their credit card is maxed.
When will the credit card get maxed for the US? For other countries, the impact is visible right away with depreciation in their currencies. But that doesn't really apply to US. So what is the max?
Look at the US economy it’s the strongest it’s ever been. Maybe that’s not a good indicator for the rest of the world?
Let’s look at some of the poorest countries? Have they improved over the last 20 years or gone south?
I don’t think I’m day dreaming, I’m working hard and building things. I can sit there and speculate or I can worry about impacting things.
I agree there is a large amount of division and political risk in the US.
Edit: but still we are far from the world ending.
More concretely, home buying is a cornerstone of the American economic system, but a combination of income stagnation, student loan debt, and absurd overpricing nationwide has priced out much of the "millennial" demographic. In my local area, shoddy houses are going for $700k, but nobody approaching 30 is buying anything. That sort of thing just isn't sustainable. And this is from the point of view of having a good tech income, which is a bubble.
This meme is so strong on HN. Is an illusion too beautiful and easy to believe, also, it have some backup.
The "world", aka us, is an addict. And is on an overdose. The chems make see thing sooooo great.
But the world is great? Not. Is just feasting when in from of it is coming a famine, but naaaaa, RIGHT NOW, all is "everything is amazing"!
Yes there are problems but there's never been a time in human history where so many people have enjoyed a basic quality of life plus some very real luxuries as they do today.
Why is this so difficult for people to grasp? The consequence of cheap smartphones in every American pocket, vehicles in every Chinese and Indian suburban driveways, meat in every brazilian meal, etc, will be the destruction of vast resource banks accumulated over millions of years. Once those resources are extracted and converted into wealth, there will be very little left to maintain our lifestyles.