HSBC boss warns of second global economic downturn

[progressiveGI]

The head of Britain's biggest bank has warned we could soon be heading into a second recession.

Michael Geoghegan of HSBC said he had delayed expansion plans because he fears the upturn could be short lived.

The chief executive said the economy could follow a W-shaped trajectory, with the rebound going into reverse and growth retreating into the red

'Is this a V recovery or a W?' he said in an interview with the Financial Times. 'It's the latter.'

Mr Geoghegan's words carry weight because of the global reach of his bank and its track record on identifying economic turning points.

In February 2007, HSBC was one of the first financial giants to warn of the impact of the sub-prime crisis in the U.S., when it wrote off £6.5billion. The intervention will fuel the debate between Labour and the Conservatives over when to slash public spending and hike taxes.

Source: Mail Online

http://www.dailymail.co.uk/news/article-1218183/HSBC-boss-Michael-Geoghegan-warns-second-economic-downturn.html

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Comment:

A second downturn would be disasterous! While there is a possibility that this may happen, those in charge of assuring us that we can spend our way out of a recession seem to have buried their heads in the proverbial sand hoping and praying that this does not actually happen.

[TheKentuckian]

1. We haven't spent enough by far

Ideally we'd spend enough to offset the 5 trillion dollar or so hole in the economy. Around 3-3.5 trillion would probably offset or better due to the multiplier factor.

[SoCalDem]

3. there needs to be an admission that we "loaned" more money than we had

and a forgiveness of debt owed by the "little people".. If "we" are expected to resume "spending", our debt has to go bye-bye too.. the fat-cats got their big bonuses and their debts erased, but they are not spending their new-found loot..they are hoarding it and consolidating their wealth by cannibalizing other companies.

All we need is really strict new rules, and a "re-set" ..

[Double T]

2. Second. Don't forget third and fourth.

Try a double W......if we're lucky.