Analogies - how sick is the global economy?

This morning Macroman offers some of his always-trenchant thoughts, this time comparing his torn ACL and its treatment to that of the global economy: How The Global Economy Is Like A Torn ACL

A few of the gems:

Treatment Options:
Knee: Macro Man can continue with the rehab program and hope for the best, or opt for a full reconstruction, which will entail a more thorough rehab program and a modest lifestyle adjustment.
Economy: The global economy can continue with the current rehab program and hope for the best, or opt for a fuller, coordinated reconstruction (IMF, WB, bank regulation, etc.) which will likely entail some lifestyle adjustment for all concerned.

Post-operative Rehab:
Knee: A long, hard slog that will require a lot of effort and, most importantly, time.
Economy: A long, hard slog that will require a lot of effort and, most importantly, time.

To continue the analogy, the weekend G20 meeting was a lot like Macro Man's last consultation with the ortho: it resulted in a vague action plan for the future, but no immediate solutions.

I'll offer up a different medical analogy, but one with which I have, blessedly, no personal experience, unlike Macroman and his knee. I promise to torture this analogy to death....

In August of 2007, the patient (global economy) suffered the first in a series of heart attacks (financial system crises) which increased in severity in March of 2008 and which reached critical condition in September and October, at which point the patient was hours from death. Large parts of its heart muscle died, and all four major valves (insurance, banking, securitization, credit) have been severely damaged. The patient remains on extremely costly artificial life support, without which it would perish within days or weeks. Due to a series of unprecedented and experimental emergency procedures undertaken the medical staff, the patient has seemingly stabilized, but remains in the ICU and is under 24-hour watch
Due to the severity of these attacks, a number of the patient's other vital organs and systems have suffered severe damage, including its musculature (manufacturing), brain function (governmental and regulatory bodies), and digestive track (consumption, or, errrr 'import/export'?))

The prognosis remains extremely dire, because the attending medical staff is facing conditions for which they have no training:

1. The patient's heart is the largest in the world, and has been severely stressed due to decades of overconsumption - mostly of high-fat consumer discretionary items
2. Procedures used to stabilize other collapsing vital organs - such as injecting food into that shrunken digestive track, or exercising the musculature when there is no consumption - risk either re-creating the very conditions which caused the crisis in the first place and/or place undue new stresses on the heart
3. The medical staff has gathered from all over the globe, as most everyone is interested in seeing this patient survive. But, due to their different backgrounds and training, they cannot agree on a course of treatment. Therefore a number of erratic and, as noted, experimental approaches have been undertaken, some of which may have done more harm than good. The Chinese doctors might have a solution, but then again they may have helped make the patient desperately sick in the first place, since most of the food it had overconsumed for years was Chinese. But there are others who argue that the Chinese could help by consuming more of their own food, and slowly weaning the patient off it. This clearly could kill the patient if it happened too abruptly, but it may be the only solution. However, at the moment the Chinese seem to have little appetite for this approach
4. Further complicating things:

• The patient's medical records are either unavailable or unintelligible, making diagnosis of the real depth of the condition unknown, even after 19 months of testing. "Stress tests" have been recommended, and are believed to be underway, but they themselves might kill the patient
• The patient has been unconscious or incoherent for the duration, making direct questioning impossible
• The patient's lead medical team changed 6 weeks ago, and the new team has different ideas as to treatment
• The patient's family quarrels over what to do. Some say let nature take its course, some say spend everything possible to keep it alive.....Also, there are members of the family (mostly in Europe) who are desperately ill themselves and who are distracted
• The hospital where the patient is being treated is technically bankrupt, and has been for years. Many are asking if we can afford to treat the patient, when it would appear that the patient will never be able to re-pay, and the hospital has other responsibilities beyond this famous patient. (It should be noted that those who raise this point are not directly involved in the actual treatment of the patient, and thus have little personal risk should the patient expire...)
• All the money spent treating the patient has caused regular folks to take notice. Of late, crowds have formed around the hospital, demanding in increasingly angry terms that money no longer be spent on a patient who only seems to squander every chance if gets to regain health. Many of these folks are themselves as sick as the patient (if not as large and famous), and could use the money for their own treatments. Making matters worse is the fact that much of the trillions of dollars spent so far on treatment has actually been siphoned off to relatives and friends of the patient (known as 'bankers') who are spending it on airplanes and country clubs....

So, the patient is in dire straits, and external forces are making recovery ever-more-difficult. A growing number of outside experts are now concluding that the patient will never be restored to full health, and are debating how to move forward.

All interested parties are meeting in London on April 2 to discuss next steps