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G-20 Agrees To Grow Global Economy By $2 Trillion, Has No Idea How To Actually Achieve It

Tyler Durden's picture




 

Apparently all it takes to kick the world out of a secular recession and back into growth mode, is for several dozen finance ministers and central bankers to sit down and sign on the dotted line, agreeing it has to be done. That is the take home message from the just concluded latest G-20 meeting in Syndey, where said leaders agreed that it is time to finally grow the world economy by 2% over the next 5 years.

The final G-20 communiqué announced its member nations would take concrete action to increase investment and employment, among other reforms. "We will develop ambitious but realistic policies with the aim to lift our collective GDP by more than 2 percent above the trajectory implied by current policies over the coming 5 years," the G20 statement said.

Australian Treasurer Joe Hockey, who hosted the meeting, sold the plan as a new day for cooperation in the G20.

"We are putting a number to it for the first time -- putting a real number to what we are trying to achieve," Hockey told a news conference. "We want to add over $2 trillion more in economic activity and tens of millions of new jobs."

And to think all it took was several dozen of politicians sitting down for 2 days in balny Syndey and agreeing. So over five years after the start of the second great depression the G-20 has finally agreed and decided it is time to grow the economy: supposedly the reason there was no such growth previously is because the G-20 never willed it... 

There is only one problem: the G-20 has absolutely no idea how to actually achieve its goal of boosting global output by more than the world's eighth largest economy Russia produces in a year. Nor does it have any measures to prod and punish any laggards from this most grand of central planning schemes. From Reuters:

There was no road map on how nations intend to get there or repercussions if they never arrive. The aim was to come up with the goal now, then have each country develop an action plan and a growth strategy for delivery at a November summit of G20 leaders in Brisbane.

 

"Each country will bring its own plan for economic growth," said Hockey. "Each country has to do the heavy lifting."

 

Agreeing on any goal is a step forward for the group that has failed in the past to agree on fiscal and current account targets. And it was a sea change from recent meetings where the debate was still on where their focus should lie: on growth or budget austerity.

So who is the mastermind behind this grand plan? Why the IMF of course: "The growth plan borrows wholesale from an IMF paper prepared for the Sydney meeting, which estimated that structural reforms would raise world economic output by about 0.5 percent per year over the next five years, boosting global output by $2.25 trillion."

The same IMF whose "forecasts" can best be summarized in the following chart (which will be revised lower shortly to account for all the snow in the Northeast US):

 

Aside from this idiocy, the other topic under boondoggle discussion was the fate of the taper, and specifically how emerging markets will (continue to) suffer should the Fed continue to withdraw liquidity. Here, once again, the developed nations won out, leaving the EMs, and particularly India's Raghuram Rajan - who has been pleading for far more coordination between central banks in a time of globla tightening - high and dry.

  • RBI'S RAJAN: POLICY TIGHTENING MUSTN'T UPSET GLOBAL ECONOMY
  • RAJAN SAYS INFLATION IS HURTING GROWTH
  • INDIA'S RAJAN SAYS BRINGING DOWN INFLATION BIGGEST CHALLENGE
  • RAJAN: DEVELOPED, EM NATIONS AGREE ON NEED TO CALIBRATE POLICY

What inflation? As for coordination, here is what the G-20 did agree on: whatever Yellen says, goes:

Financial markets had been wary of the possibility of friction between advanced and emerging economies, but nothing suggested the meeting would cause ripples on Monday. "The text of the communiqué indicates that the standard U.S. line that what is good for the core of the world economy is good for all seems to have won out," said Huw McKay, a senior economist at Westpac, noting there was nothing that could be taken as "inflammatory" about recent volatility in markets.

 

There was a nod to concerns by emerging nations that the Federal Reserve consider the impact of its policy tapering, which has led to bouts of capital flight from some of the more vulnerable markets.

 

"All our central banks maintain their commitment that monetary policy settings will continue to be carefully calibrated and clearly communicated, in the context of ongoing exchange of information and being mindful of impacts on the global economy," the communiqué read. There was never much expectation the Fed would consider actually slowing the pace of tapering, but its emerging peers had at least hoped for more cooperation on policy.

 

Hockey said there had been honest discussions among members on the impact of tapering and that newly installed Fed Chair Janet Yellen was "hugely impressive" when dealing with them.

Indeed, in the three weeks that Yellen has been Chairmanwoman, she has been truly hugely impressive. It's the next three years that may be more problematic.

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Sun, 02/23/2014 - 11:03 | 4467648 AreaMan
AreaMan's picture

"I Got this"-- The Bernanqe

Sun, 02/23/2014 - 11:12 | 4467659 jbvtme
jbvtme's picture

"We want to add over $2 trillion more in economic activity and tens of millions of new jobs."  get the fucking hook

Sun, 02/23/2014 - 11:30 | 4467693 HyBrasilian
HyBrasilian's picture

They'll send Krugman around with a bag of rocks on a window breaking spree... After that comes the alien invasion...

~~~

MOAR GROATH [on a finite planet]... Mr. Anderson was right...

Sun, 02/23/2014 - 11:35 | 4467710 Oliver Jones
Oliver Jones's picture

Moar growth is possible - we just need some major contractions, first.

And we'll get them, too - count on it.

Sun, 02/23/2014 - 11:49 | 4467737 Meat Hammer
Meat Hammer's picture

You guys fell for it again.  You think they're lying or incompetent but they're telling the God's honest truth.  

Read the words again.  "We will develop ambitious but realistic policies with the aim to lift our collective GDP by more than 2 percent above the trajectory implied by current policies over the coming 5 years," the G20 statement said.

OURS, as in theirs, as in TBTB's GDP, as in go fuck yourselves, serfs.   

Sun, 02/23/2014 - 11:53 | 4467742 BoNeSxxx
BoNeSxxx's picture

"the G-20 has absolutely no idea how to actually achieve its goal of boosting global output"

Sure they do... Control+Alt+Print

Sun, 02/23/2014 - 11:56 | 4467745 HyBrasilian
HyBrasilian's picture

All your GROATH are belong to us...

Sun, 02/23/2014 - 12:44 | 4467839 Bananamerican
Bananamerican's picture

hockey pucks promising hockey sticks

Sun, 02/23/2014 - 12:51 | 4467854 NoDebt
NoDebt's picture

Dovetails perfectly with Obama's statement "the era of austerity is over" last week.

I don't think we have anything to fear from the coming NWO, because it's already here.

Sun, 02/23/2014 - 13:08 | 4467895 remain calm
remain calm's picture

Simple. If we collectively give away 2 trillion dollars in free goverment aid (food stamps, disability checks, energy vouchers, health care stipends, job retraining grants)  we will have achieved our goals. And fuck the unborn, they will pay for it.

Sun, 02/23/2014 - 13:23 | 4467941 Headbanger
Headbanger's picture

No...  The obvious translation of it is:  "Let them eat cake!"

Sun, 02/23/2014 - 15:48 | 4468378 boogerbently
boogerbently's picture

We are all 50% better looking.....all in favor........

Sun, 02/23/2014 - 16:00 | 4468423 DeadFred
DeadFred's picture

I for one am disappointed they didn't decree world peace while they were at it.

Sun, 02/23/2014 - 20:26 | 4469155 StychoKiller
StychoKiller's picture

The surface of a planet is NOT the correct place for an advancing technological society. -- R.A. Wilson

Sun, 02/23/2014 - 13:31 | 4467970 johnQpublic
johnQpublic's picture

if i could just figure out a way to make my cancer grow faster.....

Sun, 02/23/2014 - 13:37 | 4467991 Anusocracy
Anusocracy's picture

The World's Fucker-uppers claiming the role of World Fixer-uppers.

What could go wrong with that?

Sun, 02/23/2014 - 16:12 | 4468461 XitSam
XitSam's picture

Wrong. Wrong. Wrong. Two trillion will not go to food stamps or disability checks or health care.  It will go into bankers pockets. Don't you know how the system works?  You got the payer right though.

Sun, 02/23/2014 - 13:45 | 4468019 Offthebeach
Offthebeach's picture

I was really hoping for 3 trillion groath.

Forward Green Shoots !

Sun, 02/23/2014 - 20:30 | 4469164 StychoKiller
StychoKiller's picture

I know, I'll just bump up the prices on the pictures I've already created; that should be good for another $1000 FRNs, easy!

Sun, 02/23/2014 - 12:28 | 4467797 LMAOLORI
LMAOLORI's picture

 

 

@BoNEsXXX

 

Fed Lying About QE, Media Not Paying Attention

 

SNIP

The Fed’s balance sheet for the week ended January 2, 2013, showed $2.9603 trillion in assets. A year later, the balance sheet for the week ended January 1, 2014, showed $4.0661 trillion in assets. So the Fed had added $1.106 trillion to its balance sheet during that year – $85.8 billion more than it had announced. It had in fact added on average $92.2 billion a month, not the bull-malarkey $85 billion that it kept telling the Wall-Street media circus. That's $7.2 billion a month more than announced.

And thus, the Fed’s monetization of the Federal debt exceeded the $883-billion deficit of calendar year 2013 not by 15.5% but by 25.2%!

Sun, 02/23/2014 - 12:40 | 4467826 Abi Normal
Abi Normal's picture

Sure they will grow it by digitizing (ctrl-alt-print is so 19th century), $2 trillion in fiat monopoly money, as DEBT, the morons!  These cupcakes called finance ministers need a lesson in sound money...not this keynesian BS...F'em!

Sun, 02/23/2014 - 15:49 | 4468384 boogerbently
boogerbently's picture

It's the "new Math".

You just don't understand.

Mon, 02/24/2014 - 05:17 | 4470098 dannyboy
dannyboy's picture

That's because the fed also uses the interest it recieves from the assets it holds on its sheet and re-invests those dividends and recievables into repurchasing the assets. So yeah its 85Billion in printing and whatever is gained in income from those assets aswell.

Sun, 02/23/2014 - 18:30 | 4468844 ThroxxOfVron
ThroxxOfVron's picture

The problem is the accumulation of debt/assets which are simply draining further and further resources into the hands of the wealthy who do not actually spend/consume the extra wealth.  The further accumulation of interest/reserve capital by the wealthy is being used to bid up existing assets: causing stagnation, bubbles, mal-investment, and throttling demand/consumption.   It's the classic end game of a the debt based fiat system.  The fact is: the interest to pay the debts off has never existed -and mathematically cannot exist.  

QE was/is a form of stealth restructuring aimed primarily at saving the wealthy from taking the full brunt of the rolling defaults of 2008/2009/etc....  Yet, the printing press can only do so much: the printed money used to buy up failed debt-assets at or near par by and large was simply used to bid up the same or similar debt-assets securities, bonds, real estate, equities, etc...

-The wealthy don't know what else to do but seek vig.  -The wealthy generally simply aren't really creators of real wealth so much as loan-sharks and skimmers.  It's easy to just buy .GOV debt and equities and clip coupons on the yacht/beach/roof-deck...

Restructurings, bail-ins, cram-downs, confiscations, -and outright defaults; will allow room for further growth.

Everyone with a clue as to how the system is really organized and maintained understood well before the debt saturation/collapse of 2008/2009 that the burdensome and ultimately unsustainable debts must and will be diminished or restructured or written off one way or another somehow...

The Banksters/Oligarchy have apparently agreed to some amount of restructuring and/or debt relief now that the Governments/Central Banks have been forced to cover the worst of their lost bets/failed debt-assets.

Now, as to WHO is going to be bailed in/crammed down, when and how...???

Sun, 02/23/2014 - 12:34 | 4467814 jerry_theking_lawler
jerry_theking_lawler's picture

Isn't this easily achieved with printing? Isn't that where most of our 'growth' has come from in the pat 7 years anyways...inflating currencies that drive YoY increases but which aren't really increases.....

Someone, please feel free to correct me where I am mistaken.

Sun, 02/23/2014 - 12:39 | 4467823 HyBrasilian
HyBrasilian's picture

Yeah ~ It's sort of like making potato chip packages larger & more billowy ~ while putting less potato chips into them to weigh them down... Look sheeps! They're FLYING off the shelves!

 

Sun, 02/23/2014 - 20:32 | 4469167 StychoKiller
StychoKiller's picture

Fill the bags with helium, then they'll just float off the shelves! :>D

Sun, 02/23/2014 - 12:49 | 4467850 Urban Redneck
Urban Redneck's picture

Just "printing" (in the sense of producing relatively sterilized excess bank balance sheet reserves) doesn't deliver what they seek (other than propping up insolvent banks and thereby the status quo with a ~1% skim/kicker).

What they seek is probably be a 20% margin (un-sterilized and pure profit transfer) to those at the all-seeing eye atop the social pyramid.

Sun, 02/23/2014 - 12:42 | 4467833 Urban Redneck
Urban Redneck's picture

+10

Certain people know exactly how they intend to achieve this. The framework already exists as the foundations started being laid 15 years ago (and Afghanistan and Iraq were only the least profitable wars that President Shrub fought on an ROI basis). The IMF is actually a bit player in the larger BBCCI complex (Bureaucrat, Banker, Consultant, Commercial & Industrial complex). The plan involves more wealth transfer from the have-nots to the haves by increasing debt-burden on those who can least afford it, as well as a pre-packaged globalist regulatory capture and financial exploitation package (masked as wealth transfer from developed to emerging economies which is actually a public-purse-to-private-profit recycling scheme) which makes that ideologically biased piker John Perkins look like the 12th man on the deal team... Bend over and get ready for the BBC (Big Bankster Cock) ass-raping and balance sheet plundering of least at a generation.

The two critical obstacles to successful execution are keeping the sheeple in line while maintaining the status quo CB Ponzi scheme.

Sun, 02/23/2014 - 20:33 | 4469170 StychoKiller
StychoKiller's picture

Sorry, but confiscating my savings acct ain't gonna put me in the proper mood for making side-tables for TPTB!

Sun, 02/23/2014 - 11:29 | 4467695 SafelyGraze
SafelyGraze's picture

"the G-20 has absolutely no idea how to actually achieve its goal of boosting global output"

well!

to begin with, we can agree to increase bonus for the financial rank-and-file whose work is necessary for any global recovery

that's almost a trilliion right there

also we can agree to go ahead and help more people achieve their dream of buying a new home

hugs,
linda green

 

Sun, 02/23/2014 - 13:14 | 4467700 HyBrasilian
HyBrasilian's picture

 "achieve their dream of buying a new home"

~~~

& getting edumucated [with an online degree ~ in their pajamas ~ at Southern Phoenix New Hampshire, ITT Tech] ~ just like fonestar!

 

Hey fonestar...Do your pajamas come with 'nano' pocket ~ & 'HOTPOCKET' protectors'... & seams where you can sew in BTC wallets for border crossings?...

That kinda shit might come in handy if someday you need to hightail it outta here, captivate the local warlords, & become the eventual high tech guru in BUTTFUCKISTAN...

Mon, 02/24/2014 - 09:35 | 4470374 thestarl
thestarl's picture

Yeah paying slave wages.These bunch of cunt flaps can't even hide the fact that their totally clueless.Like all those IOC official arseholes these IMF stooges are just on this gravy train peddaling misery

Sun, 02/23/2014 - 11:23 | 4467680 Jumbotron
Jumbotron's picture

Easy Peasy.  It's a two step process.  First, we confiscate depositor's assets.    Step two, we print.   See....easy.

 

 

Sun, 02/23/2014 - 11:28 | 4467691 Sudden Debt
Sudden Debt's picture

I got this I got this!
REDISTRIBUTION OF WEALTH!!

take the money from everybody
and give it to those who need it most...
the 0.000000000000000001% or... me

AND THAN WE LET THE WEALTH TRICKLE DOWN AND CHANNEL THE MONEY TO THE PLEBS OVER A TIMESPAN OF 2000 YEARS!!!

NOW THAT'S A PLAN!!!!

Sun, 02/23/2014 - 11:37 | 4467718 agent default
agent default's picture

An increase in taxes and possibly a one off (yeah right) tax on all assets is definitely part of their agenda.  Hence the attack on bank confidentiality spearheaded by G20 and the OECD.

Sun, 02/23/2014 - 12:43 | 4467836 Abi Normal
Abi Normal's picture

Bingo, from each according to his ability, to each according to his need!  It's really quite simple!  Marxism is alive and well here in the good ol USSA!!!  Oboingo is seeing to it that he transforms Amerika all right...the rat bastard!

Sun, 02/23/2014 - 11:54 | 4467744 Sean7k
Sean7k's picture

Isn't that just two platinum trillion dollar coins? 

Sun, 02/23/2014 - 20:36 | 4469180 StychoKiller
StychoKiller's picture

It's either that or someone's gonna have to get off their Hoverround, put down the Cheetos, climb the basement stairs, go to the local machine shop and start milling Space Shuttle rocket parts!

Sun, 02/23/2014 - 11:23 | 4467686 Sudden Debt
Sudden Debt's picture

15 MINUTES ON A WEEKDAY, 16 ON SATURDAY AND 17 MINUTES ONA SUNDAY!!

LET'S ROLL ANGELS!!!

Sun, 02/23/2014 - 14:43 | 4468174 ZH Snob
ZH Snob's picture

well, one way to get that growth would be to install a puppet regime in, let's say, Ukraine.  you know the drill: get the central bank, debt thing going, strip away all the natural resources, manufacturing, wealth and industry, etc. and if that doesn't work out they can always turn it into the big world war they need to distract everyone from their criminal enterprise that has finally reached its inevitable demise.

Sun, 02/23/2014 - 11:04 | 4467649 Seasmoke
Seasmoke's picture

All they have left are words.....meaningless words. 

Sun, 02/23/2014 - 11:20 | 4467677 Winston Churchill
Winston Churchill's picture

"Let them eat cake" comes to mind.

Roll the guillotines also does.

Sun, 02/23/2014 - 11:34 | 4467707 kaiserhoff
kaiserhoff's picture

Funny.  Last night the pooch and I agreed to increase our stash of gold and silver by $1 Trillion.

This morning, it turns out that I thought she had a plan, and she thought that I had a plan.

Der damn dog needs weniger wein zu trinken.

Sun, 02/23/2014 - 11:30 | 4467694 Sudden Debt
Sudden Debt's picture

words...
it's what gets you laid.

Sun, 02/23/2014 - 11:30 | 4467696 BandGap
BandGap's picture

Truly disappointed there was no mention of sugarplum fairies.

 

Sun, 02/23/2014 - 11:36 | 4467715 kaiserhoff
kaiserhoff's picture

This is international.  Let's leave the Nobel Laureat out of it;)

Sun, 02/23/2014 - 12:44 | 4467844 Abi Normal
Abi Normal's picture

Yes, a tragedy!  But there is always unicorn skittles?

Sun, 02/23/2014 - 17:45 | 4468730 TBT or not TBT
TBT or not TBT's picture

Unicorns that conveniently piss watermelon flavor Arizona Iced Tea and shit skittles. For the rest of the purple drank recipe you have to use your SNAP/EBT/Obamacare subsidies at your government regulated pharmacy.

Sun, 02/23/2014 - 12:04 | 4467756 BeanusCountus
BeanusCountus's picture

Reuters:

After reaching agreement on the actual growth of the global economy, leaders then split off into separate workshops to plan government spending of the increase in tax receipts.  Many came out of the workshops, hosted by Goldman Sachs, impressed with the concept of packaging the future tax receipts into securitized products on Monday, and selling them to individual investors with guaranteed rates of return exceeding 10% annually.  Lloyd Blankfein, Chairman, commented that the "securities" represent a terrific investment for retirement plans across the globe, even going so far as to suggest regulations that require specific allocations of the products in each investor's portfolio.  "Now that we have that growth thing out of the way, it's about time that investors step up to the plate.  For their own good of course."  The products contain a 25% upfront load charge, with Goldman Sachs and JP Morgan Chase the lead underwriters.

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