TO FUNCTION successfully in this world of ours, it is always important to recognise and accept reality, that of seeing the world as it is rather than as one would like it to be.

Applying this principle to the global economy, despite my innate optimism it seems to me we are once again trying to defy gravity.

The lessons of the 2007-8 financial crisis seem not to have been learned sufficiently. One of the main tools used to keep the system afloat after this dire sequence of events, the instrument dubbed quantitative easing (QE), only bought us some time. Indeed, QE is simply a euphemism for printing money by governments through the issuance of bonds and yet more bonds, which in today’s parlance is borrowing on "the never-never”.

Borrowing too much got the world into the mess of roughly 12 years ago, and the world’s debt is now greater than ever, and growing. Many countries are burdened with national debt that actually exceeds their entire economic output for a year, as measured by their gross domestic product (GDP). This includes the United States, Japan, Greece, Portugal and Italy. Just outside the 100 per cent level are France and Belgium.

Here in the UK the figure is around 85 per cent, not something to boast about, but relatively sounder than many others. Germany, the largest economy in the EU, is faring notably better, but all signs show them heading toward a recession.

Current statistics concerning personal household debt globally are equally alarming. One does not have to be a renowned economist to recognise we cannot carry on piling debt onto more debt.

Common sense is all that is required to grasp the seriousness of borrowing excessively, and don’t let anyone try to tell you otherwise, irrespective of his/her position and credentials. Keep in mind that many so-called experts often have their own agendas.

Borrowing without limits eventually has its consequences and I think we are edging ever closer to another calamitous downturn. All it will take is for a large international bank to fail, a currency crisis within the Eurozone, another major military conflict in the world, an oil shortage, a natural disaster somewhere significant, further environmental stresses, and many other possibilities.

The best one can do is to calmly prepare for the worst and hope for the best, a saying that has been appropriate throughout the ages, and for good reason. More specifically it only makes sense for each of us to get his/her financial house in order as best as possible, and to do whatever else is applicable individually.

Lastly, I do not say these things to cause alarm as I have confidence we will rise to the occasion as we have throughout our history.

Yes, times and circumstances change, but I believe our national character remains robust, especially when challenged by outside forces and when we truly need to all pull together.

Ira Fishman