PRINCETON, NJ, August 6, 2012 – In his latest white paper, “Unprecedented Global Government Intervention,” NAI Global Chief Economist, Dr. Peter Linneman, discusses the dangers and pitfalls of the extraordinary wave of global government intervention we are currently witnessing in capital markets. Citing historical examples, he demonstrates that intervention leads to prolonged periods of stagnation and uncertainty; “In all, government activity is now deterring the very investment it was hoping to spur.”

“As we enter the third quarter of 2012, we are seeing the pattern of unprecedented government intervention continue,” states Dr. Linneman. “Governments around the world are using the powerful tools at their disposal; spending, regulations, fiscal policy, and taxes to interfere with the free market in hope of sparking economic recovery. The result is that instead of recovery, we are experiencing further distress as the Euro crisis intensifies and even Brazil and China’s economies slow.”
On the U.S. economy, Dr. Linneman notes, “the irony is that the belief in big government is occurring even as trust in the U.S. government (and most other governments) is near an all-time low.”  He adds, “Huge deficit spending causes private spending to decline as the private sector realizes that it has a greater future tax liability of equal magnitude. We have witnessed this in the U.S., almost dollar-for-dollar in deficit spending.”
The white paper also addresses the historical cause and effects of regulatory intervention, unemployment statistics, and the upcoming Fiscal Cliff set to unfold in January 2013.
Unprecedented Global Government Intervention follows Global Economic Round-Up where Dr. Linneman evaluated the state of the global economy in Europe, Asia and the United States, including the impact of the continuing European debt crisis, the rise of China and India and the current state of the U.S. economic recovery.  NAI Global’s white papers and research resources are available for free download under Publications/Articles & White Papers.