Over the Christmas period I have asked a number of people how long they think this downturn, as the BBC still calls it, is going to last. Most estimates vary from 6 to 18 months. Many economists refer to historical recessions as lasting about 5 quarters.
It just ain't going to happen!
I've just been reading this after following a link from Guido. Average U.S. indebtedness is getting towards $1 million per family. Counting off balance sheet items, the UK isn't far behind. The trouble is that the average family just isn't capable of repaying that sort of debt. It's also getting worse as highly productive indigenous families get smaller. America's only way out of this crisis is to devalue the dollar dramatically. This will fundamentally alter its relationship with the rest of the world – permanently. Moreover, the ramifications of this are huge. China, Japan and the other dollar 'hoarders' will feel enormous pain as this happens; it's unlikely that their governments, not to mention systems of government, will all survive.
The upheaval on the West side will be just as great with the EU, or parts of it, as good contenders for collapse. Just as the 'hoarding' governments will have to learn to share more with their people, the West will have to learn again to live within its means.
There is absolutely no way that all this is going to work its way out in just a couple of years.