In the fall of 2016, newspapers such as The New York Times and Financial Times published articles on the recovery of the economy. Is this really the case? It seems we cannot rely on these articles in these otherwise highly-regarded newspapers. From 2001 to 2016 the percentage of the upper-middle and middle class in the US fell from 63% to 51%. This means that some 25 million American economic lives crashed.
The above statement illustrates the dramatic situation in the financial markets where no one, no one at all, has any control. This is what we face daily in our strategic intelligence practices. We provide some insight as to why we cannot rely on the financial system, or on presidents, prime ministers, politicians or central bankers.
The story starts every year with the World Economic Forum in Davos, Switzerland, where the heads of the corporate world meet: CEOs, political friends and the consultancy-whisperers. They blame the politicians who are not able to solve the crisis, corporate management already has a focus on the future, and multinationals take the lead in solving the big future challenges: sustainability, growth and poverty.
Can you imagine that five years after the financial crisis, the financial system in Europe has still not yet improved? Banks still continue to package ‘risky financial products’ into special entities. Our bankers still behave the same as they did before the financial crisis. Why is this so? Bankers think they are better protected against the next financial crisis, because they have a higher percentage of equity on total assets. It’s business as usual all over again.
Do you remember the ‘three wise men’ of the EU, Van Rompuy, Barroso and Schulz, celebrating their receipt of the Nobel Peace Prize in Oslo in December 2013? This looks like an example of toxic politics! Have they thought of new challenges to solve the European problem of high unemployment?
“Politicians keep throwing money to support weaker nations’ debt problems, they never talk about restoring growth”The above statement comes from Roger Bootle in Fortune Magazine, dated 8th October, 2012. Why should we listen to him, you may ask, as we read so much from so many economists, daily, about the problems across Europe? For two main reasons: Roger Bootle predicted the downturn of the 2002 dotcom bubble back in 1999, and the worldwide financial crash in 2007 back in 2003!