10 lessons from the great 21st century recession

1. The seven year economic cycle is a dead concept
It used to be the case and is supported by much evidence that economics tended to go in seven-year cycles: seven years climbing and seven years declining. We are now nearly six years on from Lehman’s collapse though the current recession dates back to a year before that when LIBOR rates spiked suggesting a collapse in confidence in bank debt amongst banks themselves. The interconnectivity of global markets and economies means that each economy is more likely to be affected by a global than domestic issue today. Warning signs may be around the globe, not around London, New York or Tokyo. We disregard warning signs at our peril, but warning signs are now far harder to discern.