One reason I prefer economics to finance is that timing has never been my strongpoint. I thought the tech bubble was going to pop in 1998. I wrote a column in 2002 that commented on the expansion of the housing bubble and noted that this was likely to have a negative effect on the global financial system, but never imagined that the bubble could go on as long as it did or that real-estate prices would rise to such elevated levels. So, given this track record of prematurity, it should be no surprise that it has taken longer for the economic consensus to recognize that the global economy is caught up in a very large economic contraction than I anticipated.
But it is coming, nevertheless. Consider the following two headlines from last week:
“‘WE ARE ON THE VERGE OF A GREAT, GREAT DEPRESSION'”
– Drudge Report, June 1, 2011
“U.S. house price fall ‘beats Great Depression slide'”
– The Independent, June 1, 2011