Economic cycle has reached the phase that dare not speak its name

IN the financially challenging years of the early 1980s, British Prime Minister Margaret Thatcher excused her tough, ‘uncaring’ economic stance by famously reminding her detractors that “you can’t buck the markets”.

Since the last quarter of 2007 central banks throughout the world — particularly the US Federal Reserve — have been frenetic in ongoing desperate attempts to buck a potentially catastrophic contraction within the global financial systems.

The panic cuts in US interest rates may have boosted monetary confidence in the short term, but these cuts have resulted in unintended consequences with the relentless rise in the dollar price of oil and other commodities.