The next downturn could rival the Great Depression and wipe $10 trillion off U.S. household assets

The banks may be safer today but the debt-drenched world economy is even more fragile than it was in 2008, and political solidarity has collapsed

The world’s major economies are skating on dangerously thin ice and lack the fiscal, monetary, and emergency tools to fight the next downturn.

A roster of top crisis veterans fear an even more intractable slump than the Lehman recession when the current ageing expansion rolls over. The implications for liberal democracy are sobering.

“We have no ability to turn the economy around,” said Martin Feldstein, President of the US National Bureau of Economic Research.

“When the next recession comes, it is going to be deeper and last longer than in the past. We don’t have any strategy to deal with it,” he told The Daily Telegraph.

Professor Feldstein, a former chairman of the White House Council of Economic Advisors, described a bleak scenario more akin to the depressions of the 1870s or the 1930s than anything experienced in the post-War era.

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