A decade after Lehman fell, the global economy is not better. It’s worse

Investment is low, growth is slow and crisis in China would leave central banks with little firepower to stave off decline

Ten years after the collapse of Lehman Brothers and the financial crisis that followed, it is clear that far from being safer, the world is a more unstable and worrisome place. In the UK, average wages remain below pre-crisis levels and inequality is high. Investment in equipment and hi-tech processes, the cornerstone of future growth, is low.

Not surprisingly, given the emphasis on extracting funds from companies rather than investing them, the productivity of the average worker, as measured by their output per hour, is well behind that of comparable developed nations.

Lehman Brothers filed for bankruptcy on 15 September 2008. With $639bn in assets, it was the biggest bankruptcy filing in history - 10 times the failure of the fraud-riddled energy company Enron.

Continue reading...