Monday, April 6, 2009

Economics Professors: Global Crash Worse Than During First Year of Great Depression

Many people (including me) have pointed out that the crash in the U.S. has arguably been worse than during the first year of the Great Depression.

But the Great Depression was a global, not just a U.S. crash. So how does the last year compare to the 1929 depression on a world-wide basis?

Economics professors Barry Eichengreen and and Kevin H. O'Rourke have written a paper conclusively showing that the global crash has been worse in the last year than during the first year of the Great Depression.

Because a picture is worth a thousand words, you can quickly see what they're talking about by looking at the following 4 graphs:

Figure 1. World Industrial Output, Now vs Then

Figure 2. World Stock Markets, Now vs Then

Figure 3. The Volume of World Trade, Now vs Then

Figure 6. Government Budget Surpluses, Now vs Then

(Note: In the last chart, the colors are reversed, and the blue line is from the 1920's.)

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2 comments:

  1. UnknownApril 7, 2009 at 4:08 PM

    Great article, the graphs say it all. Thanks a lot George and all you Free Market folks.

    ReplyDelete
  2. Ross J WarrenDecember 25, 2009 at 4:13 PM

    Sobering, but the surprisingly vigorous rebound uplift is encouraging, sadly folks this is an illusion, unless we are willing to pump in very large amounts of printed cash it will fall relatively quickly. There are hopes. Mico-Wave diffusion technology should make Diamond windows a reality within a few years. Laptop screens made of thin diamond is within sight. Diamond is the material that will punch forward Hi-Tec, and will make the manufacture of other useful crystalline structures a matter of refining the technology only. Scientists need funding, but these ideas have already delivered the first samples.




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    ReplyDelete

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