March 13th, 2009
02:00 PM GMT
LONDON, England – Few have escaped the impact from the world financial crisis - and week-by-week the accumulation of data showing just how bad it is grows and grows.
Case in point: The United States. According to new statistics from the Federal Reserve, the net worth of Americans - that is the difference between their assets and liabilities - was $51.5 trillion last year, down nearly 18 percent from 2007. That's a massive drop in one year.
To put that in perspective, it's the first decline in net worth for American households since 2002 and one that puts their wealth back to 2004 levels. Four years of gains wiped out in just 12 months.
The value of their stock market holdings, including retirement plans, fell to $12.1 trillion in 2008 from $20.6 trillion the year before. And, of course, we know further losses have been suffered this year.
Add in rising unemployment, and it is no wonder Americans as consumers elsewhere are feeling more uncertain. I suspect a year from now, 2009, will show another drop in Americans' net household worth.
Of course, the wealth destruction we've seen in the United States is being repeated elsewhere. Sharp downturns in housing prices have hit the UK. There, the Bank of England has this week introduced quantitative easing - sometimes called "printing money" - to pump cash into the system. Interest rates, now at 0.5 percent, are at their lowest in the bank's 315-year history and have not much further to fall, hence the need for a new strategy.
Meanwhile Japan, the world's second largest economy - which itself tried quantitative easing earlier this decade - announced this week that it had seen its worst drop in GDP in the last quarter since 1974.
Chinese exports fell 25 percent last month - even Chinese Premier Wen Jiabao has said he was worried about the safety of China's assets in the United States.
But these are the numbers, statistics and data. Behind the figures lurks a massive cost to men, women and children around the globe.
Central and Eastern Europeans who bought homes in other currencies are now facing a sharp increases in mortgage payments because of the fall of their own currencies.
Those workers who came to places like Dubai and Taiwan to find employment on construction sites and in factories have lost jobs - and with it, the pay check and safety net they provided to their families back home.
Even Russian oligarchs have had billions shredded off their wealth with the fall in commodity prices.
The fallout from this financial crisis is not over yet - and for tens of millions the pain being felt across the globe will remain for sometime.
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