Fed chairman Ben Bernanke has warned that the surge in oil prices will undermine any chance of recovery. Economist (Dr Doom) Nouriel Roubini says oil prices could even trigger a double dip recession.
But blaming it on oil is just an excuse. The banks have done so much damage to the economic fabric that we don't know whether there will be a recovery at all. A double dip recession could be part of the mix. This downturn is very different from all the others because there has been no real sign of recovery.
As the Bank of England governor Mervyn King puts it, things may never recover.
King says: "It is not like an ordinary recession where you lose output and get it back quickly… You may not get it back for many years, if ever, and that is a big long-run loss of living standards for all people in this country … The cost of this crisis is only now being felt. I'm surprised that thedegree of anger hasn't been greater."
He is wrong on that point. We are seeing signs of anger right around the world with volatile electorates in the US, Britain and Australia and groups like the Tea Party stirring up emotions. The anger is rising. Just another way the economic meltdown has damaged society.
If King is right, and there is no recovery, we should all be concerned.
no comment untill now