Category: The Great Collapse

The Great Collapse

Fundamentals of the Crisis 1) The Debt Trap

Lebanon is going through its worst economic crisis in history. Due to the multi-faceted nature of the crisis, there remains clashing perspectives in society regarding the main factors of the crisis. In terms of economic fundamentals, the crisis was due to the accumulation of unsustainable balance of payment (BoP) deficits over 30 years, mainly attributable to the twin deficits, “trade and fiscal”. These deficits primarily … Continue reading Fundamentals of the Crisis 1) The Debt Trap

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The Great Collapse

Banana Republic

Lebanon is going through its worst crisis in history. The destruction of public wealth and wipe out of private wealth is unprecedented in the nation’s history. The collapse never needed to be so dramatic. Deposit losses would have only been at around 20% a year ago, instead of 70% today, had the government embarked on some sort of soft landing, orderly restructuring. Instead, the Lira … Continue reading Banana Republic

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The Great Collapse

Tragedy of the Deadlock

The tragedy of the deadlock carries on, as the Lira surpasses 13k, its lowest level in history.  The misery of the people aggravates. Shortages and supermarket fights abound. Political tensions over purchasing powers arise. Subsidy cuts in fuel and wheat seem to be coming.  To top it all off, complete power blackout looms. Carriers loaded with fuel oil have not yet been able to unload … Continue reading Tragedy of the Deadlock

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