"There is essentially no difference between one administration and another, no matter what the platform." ~ Ron Paul, on CNBC Futures Now; he also stated that "They haven't the vaguest idea what Austrian free-market hard-money economics is"…

I am writing this commentary in the morning of October 16th. For tonight, the world holds high expectations in the second show-debate of incumbent President Obama and his challenger, Mitt Romney. Much spectacle is expected for that once again.

Personally, I am somewhat concerned that Ron Paul might be absolutely correct in his assessment: "There is essentially no difference between one administration and another, no matter what the platform." The global context, economically and politically, is one that leaves little room for impact at this point. But then, what would a Swiss know about US politics? I do have to say, though, that I have been impressed with Romney's Vice President Candidate, Mr. Paul Ryan. We've included in the News Briefs a recent article on Ryan's budget, published in the Wall Street Journal and written by Daniel Mitchell.

As of late, several wondrous elections have been in the news. Certainly, the US presidential election is at the very top of sensationalist news coverage. Then, of course, the European Union's win of the Nobel Peace Prize has risen a few eyebrows at least. But then, in this context, another "election" should be given much more attention. Implicitly, at least, it appears that the Japanese "20-year success story" and economic model of muddle-through stagflation has been given first prize.

The Global Economy is Decelerating

Irrespective of whether Mr. Obama is re-elected, or whether Mitt Romney takes the presidency, clearly the global economy is decelerating. This is particularly sobering in consideration of all the printing and pumping of central banks everywhere. The current picture is one of weakness across the board.

So far, the focus is still on the eurozone and its weakening periphery economies. They have been in recession for several quarters now, with little sign of improvement. Stricter austerity measures will further weaken these economies for some time. Dramatic unemployment rates and rapidly falling consumption numbers raise grave concerns, particularly in regard to the Spanish economy.

Italy, too, has its problems, although I am far more concerned about the developments in France. Under Hollande's socialist "leadership" it appears that every possible decision is being taken to further destroy the country. Even in the German economy, Europe's growth driver until now, which has so far appeared somewhat immune to the economic slowdown elsewhere, a considerable slowing if not negative growth is expected in the next few months.

Even in Asia, and China in particular, hope of a soft landing are being challenged. A recent spate of disappointing economic data has appeared. Results for industrial output, retail sales and foreign trade were all lower than analysts had expected.

Of course, further easing of monetary and fiscal policy is expected. By definition, and based on the laws of decreasing incremental returns, the results should be expected to have less and less impact. And this is where Japan comes to mind.

Is Japan the Best-Case Scenario?

Have the world's leading elite chosen this model, ugly as it is, because in their eyes this is the best scenario available? Politicians certainly don't want the next big crash to be accounted on their time of duty. A "soft and never ending landing" might appear as a better choice to them than a hard and abrupt landing, one that obviously would be much more visible.

The last 20 years of Japanese economic history illustrate clearly that a "muddling along" scenario can last for a very long time. The question is whether the same kind of timeline could evolve for the rest of the global economy. It is sobering to see how long governments and central banks are able to "kick that can down the road" for yet a little longer again and again.

At the end of 1989, the Nikkei stock index climbed to an all-time high of nearly 39,000 points. Then the speculative bubbles in the equity and real estate markets burst. The Japanese central bank lowered interest rates to zero and shored up inefficient economic structures with a policy of cheap money. Despite numerous government stimulus programs, Japan plunged into recession and was sucked into a deflationary spiral. The NIKKEI index as of today stands at 8,701 points.

Today, Japan holds the dubious distinction of having the world's highest government debt − over 230% of GDP. The structural problems plaguing the economy continue to be deferred into the future with cheap money and endless borrowing.

I have strong doubts that this "model" will achieve a similar longitude for the global economy. However, the timeline might not be as critical for your investment decisions as the mere recognition and acceptance that, in terms of monetary policies, we have entered a one-way road.