Long depression?
Not only is the developed world experiencing the longest period of continuous economic growth after the World War II but also does the current state have some parallels to the situation in last third of 19th century.
Dario Perkins, global macro economist for TS Lombard, noticed that the financial crisis and its consequences are nothing new. The results such as deflation pressure, low labor productivity growth, population income, populism rise or aversion against globalization were already present in the developed world in the beginning of 19th century.
First global economic crisis started in 1873 and lasted 6 years in the US. The situation was preceded by a long period of economic growth and low unemployment. Also, optimism and faith in the increase was similarly present before the depression. Yet, the Vienna Stock Exchange crash in 1873 cut down the prospects. The financial crisis spread globally and changed into economic crisis. Upcoming months will reveal whether the situation will repeat.
