The Sarcasm Report v. 47

I have great news!!

BIS:OTC Derivative Volumes Continued Recovery In 2nd Half '09

Notional amounts of all types of OTC derivatives rose 2% to $615 trillion at the end of December 2009 from six months earlier.

I knew you'd be worried if there weren't at least $90,000 in derivatives for every man, woman, and child on this planet. You can now take a deep breath and relax knowing that the worst of our problems are no doubt behind us.

That's not the only reason to be optimistic though.

The World Factbook

2009 marked the first year in the post-World War II era that global output - and per capita income - declined; output contracted 1% year-over-year, compared with average increases of about 3.5% per year since 1946.

No. That's not the reason to be optimistic. Keep reading.

In 2009, global per capita income fell about 2% to US$10,500, as global unemployment rose from just over 7% in 2008 to nearly 9% in 2009 - underemployment, especially in the developing world, remained much higher.

That's not it either. You'll just have to trust me on this.

The world economy now faces a major new challenge, together with several long-standing ones. The fiscal stimulus packages put in place in 2009 required most countries to run budget deficits - government balances deteriorated for 14 out of every 15 countries. Treasuries issued new public debt - globally, worth about $4 trillion - to pay for the additional expenditures. To keep interest rates low, many central banks monetized that debt, injecting large sums of money into the economies.

Keep reading. It can't be all bad.

In early 2010, excess capacity existed in product markets, and inflation was not an immediate threat. However, when economic activity picks up, central banks will face the difficult task of containing inflation without raising interest rates so high they snuff out further growth.

Okay. My credibility is starting to crumble. I realize that. Just keep reading though. There's got to be optimism in here somewhere.

Long-standing challenges the world faces are several. The addition of 80 million people each year to an already overcrowded globe is exacerbating the problems of underemployment, pollution, waste-disposal, epidemics, water-shortages, famine, over-fishing of oceans, deforestation, desertification, and depletion of non-renewable resources.

Look. Don't expect too much from me. It isn't easy being optimistic. 200 years ago you wouldn't have enjoyed TV. 200 years from now you might not either. Maybe you were born during peak civilization? How can that be a bad thing? Okay, okay. That's not optimism either. Can't say I didn't try.

The nation-state, as a bedrock economic-political institution, is steadily losing control over international flows of people, goods, funds, and technology.

Don't worry. The optimism is coming soon. I can feel it.

In Western Europe, governments face the difficult political problem of channeling resources away from welfare programs in order to increase investment and strengthen incentives to seek employment.

This was last updated in April. Western Europe does indeed seem to face difficulties right now. The CIA sure knows their stuff. This isn't the optimism of course. We're almost there though.

Despite these challenges, the world economy also shows great promise. Technology has made possible further advances in all fields, from agriculture, to medicine, alternative energy, metallurgy, and transportation. Improved global communications have greatly reduced the costs of international trade, helping the world gain from the international division of labor, raise living standards, and reduce income disparities among nations.

There it is. There's the reason to be optimistic! Woohoo! Income disparities among nations are being reduced. If you live in one of the poorer countries taking on more and more of what America once did for a living, then maybe that's pretty good news for you. Here's some bonus optimism.

Much of the resilience of the world economy in 2009 resulted from government leaders around the world working in concert to stem the financial onslaught, knowing well the lessons of past economic failures.

Just think where we would we be without Ben "There Is No Housing Bubble to Go Bust" Bernanke , Alan "Never Saw an Irrational Exuberance I Didn't Like" Greenspan, Timothy "There Was a Slight Problem With My Taxes" Geithner, Chris "My Fannie Mae Be Fundamentally Strong" Dodd, George "Mission Accomplished" Bush, Barack "Change Is Coming" Obama, Gordon "I Dumped Gold at the Absolute Bottom" Brown, and Angela "The Trillion Dollar Woman" Merkel?

If that's not a reason to be optimistic, then I don't know what is. Just look at the confidence in the following picture!

Berlin backs EU aid fund after Obama prodding