Gross domestic product remains well below what its 2007 trend would have implied and it's unlikely the economy will ever make up that lost ground, according to research from the Federal Reserve Bank of San Francisco published Monday. The hit will cost the average American $70,000 in lifetime income, they estimate.
"Without the large adverse financial shocks experienced in 2007 and 2008, the behavior of GDP would have been very different," Regis Barnichon and his co-authors write. They find that the hit to growth was persistently 7 percentage points deeper than it would have been in the mild recession that they think would have occurred without the financial meltdown. "This is a large number."
They arrive at the lifetime income loss by taking per-capita GDP in 2007 and discounting at an annual 5 percent rate to calculate its present value.
Comment: While the state of the West was already in terminal decline because of perpetual and illegal wars, outsourcing and systemic corruption, the decision of governments to bail out the casino banking system with the public purse, and then using that as an excuse to impose 'austerity measures' on its tax paying citizens, has resulted in a nigh on collapse of Western economies:
- California sinks into economic abyss with highest poverty rate in the US
- Income stagnation and rising poverty: Millions of UK families earning less than 15 years ago UK retailers requesting rent reductions, shutting stores and laying off staff as economy tanks
- The solution for the missing trillions: US gov audit standards to be "modified" under guise of 'national security'
- Morgan Stanley: US stock slide was just the "appetizer"
- Social Justice, Clinton and the 2008 Global Financial Crisis
See the video below for a simplification of the troubles the UK is facing - and you can forget the party politicking because the Labour government are just as liable for the dire state of the country: