These stimulus pacakges would be catastrophic unless we strictly follow the fundamental principles of Economics and Banking, improve or increase the income and the purchasing power of the general public,make a reasonable saving and investment and innovation and above all become competative. Other wise, the stimulus pacakages would be counter-prodctive and make the crisis more severe and prolonged than predicted.

Unfortunatly, all these stimulus pacakges have been reduced into mere adhoc measure to clear the market of the unsold items without any measure for increasing the income, purchasing power, saving, invetament and innovation. Without making a drastic cut in cost of living and cost of production no economy can be competative and sustainable.

There is no doubt, oil price fall to the extent of $ 40 per barrle within three months, the time in which almost all stimulus pacakges are exhausted and nobody has any more fund to gnerate a minimum demand for oil or cars. The present trend of the rise of oil price without the backing of any economic reality is the greatest symptom of the Real Crisis more severe than the Hreaty Depression of 1929.

The greatest tragedy is that nobody has realized the seriousness and complexities of the Crisis and no concious and massive global action has been launched so far to deal with the Crisis. Both IMF and the World Bank too are confused without any solution in their hands. So also are the cases of our Gurues and Experts.

Credit or money supply is not the real problem, but the actual earning and purchasing power, the rate of saving and investment supported by innovation. According to the present trend, the Crisis will remain till the end of 2015 or 2017 becuase the wounds of the global economy are so deep.

A Global Summit on the Global Economic Crisis , that too with sound and sincere home works, must be convened and global actions must be launched to save the millions from prolonged harships, mental brakedowns, crimes and suicides. Let the UN, the world religions, various national and intgerantional agancies and governments come forward to save millions.

From NY Times May 14, 2009:

“in the midst of the worst global downturn since the Depression, Norway’s economy grew last year by just under 3 percent. The government enjoys a budget surplus of 11 percent…

Instead of spending its riches lavishly, it passed legislation ensuring that oil revenue went straight into its sovereign wealth fund, state money that is used to make investments around the world. Now its sovereign wealth fund is close to being the largest in the world, despite losing 23 percent last year because of investments that declined.

….there has been no real estate crash in Norway because there were few mortgage lending excesses. After a 15 percent correction, prices are again on the rise.

…Banks represent just 2 percent of the economy and tight public oversight over their lending practices have kept Norwegian banks from taking on the risk that brought down their Icelandic counterparts. But they certainly have not closed their doors to borrowers. ”

Correction: May 22, 2009
An article on May 14 about Norway’s relative economic stability in the midst of a global downturn misstated its debt status. While the government enjoys a budget surplus and is a net creditor, it has liabilities related to social security and other programs equal to about 50 percent of its gross domestic product; its ledger is not “entirely free of debt.”

http://www.nytimes.com/2009/05/14/business/global/14frugal.html?_r=1