The global system's "Western core" weakened and "multilaterism is challenged." Central banks may have built "expensive bridges to nowhere." Ripple effects from are felt globally. Their "ballooned" balance sheets are dangerously overstretched.
Debt crises persist. Economies are bailout dependent. Policies so far avoided crashes. At issue is for how long? Europe is especially troubled. Zombie Greece awaits its obituary to be written. Portugal's on the verge of cratering. Spain and Italy aren't far behind. France and Britain are weak. Germany, the continent's underpining, shows disturbing signs.
Rising bond yields signal trouble. Some financial analysts suggest euro crisis round two arrived or at the least draws near. A Financial Times/Brookings Institution report said the world economy "remains on life support." It's levitating on an ocean of money. According to Brookings' Eswar Prasad:
"The global economic recovery is still spluttering due to a lack of robust demand, policy tools that are stretched to their limits and unable to muster much traction, and enormous risks posed by weak financial systems and political uncertainty."
A worried Wall Street Journal article headlined, "Sowing Seeds of the Next Major Crisis," saying:
In America and Europe, private sector "dependence on government support" produces "excessive risk-taking, distortions in capital markets, and" greater inflationary pressures. The foundation for the next crisis looms.
What worked last time won't next time around. Unpalatable consequences await. When risk stops being a dirty word, today's "unwitting experiment in state-influenced capital markets may be sowing the seeds of the next crisis."
Fragility threatens greater crisis with few effective tools left. Global slowdowns and declines are increasing. Troubled Greece is a corpse awaiting burial. Spain's pain contaminates the continent.
What's a central banker to do? There's "little they can do on their own," says El-Erian. Avoiding global depression conditions may have only delayed them. Main Street America and Europe already experience them.
Monetary madness put central banks in a box. They made their bed and have to sleep in it. So do ordinary households victimized by their policies. Western banks, other corporate giants, and rich elites got the benefits. They got the pain. It's not getting better. It's getting worse.
The mother of all walls approaches. Rising inflation may signal it. Housing's continued crisis prevents recovery. Financing remains totally dependent on government support.
Risky liar loans keep being made. It proved past mistakes taught nothing. Weiss notes worrisome "deadly cancers." Wall Street central bankers run things. Elected leaders were shoved aside.
Instead of financing growth through savings and investments, debtor economies are financed with fiat currencies. Instead of prudent investing, speculative excess dominates financial markets.
Bad endings are preordained. How bad depends on how long imprudence prevails. It shows no sign of ebbing. The longer it's sustained, the worse the outcome.
Former bank regulator/financial fraud expert Bill Black believes today's crisis is 70 times larger than the collapse of the S&L industry in the late 1980s.
"(G)enius technocrats" aren't in the wings with solutions. Forgotten past mistakes are repeated. Consequences are far more grave. Unprecedented fraud produces today's profits.