This harsh reality is reflected in the World Bank Global Outlook Report of June 22, 2009.
It notes the following for 2009:
*Global growth is set to fall by 2.9%
*World trade is likely to shrink by nearly 10%
*Industrial production in rich countries will drop by 15% from August 2008
*Developed economies will contract by 4.5% in 2009 and grow only in 2010 and 2011
*The US economy will decline by 3%
*Private capital flows to developing countries are likely to be halved, from $US 707 billion (2008) to $US 363 billion (2009)
*Industrial production in developing countries, excluding China, is set to fall by 10%.
*GDP growth in developing countries will fall from 5.9% (2008) to 1.2%.
Cash flows halved, falling growth, and shrinking GDP, is that the foundation of a square root recovery? I’m still reminded of the chart from the Depression where a sharp up-turn on a graph is followed by a longer and sharper down-turn rather than a flat line. Flat line… that seems ominous too_______________________ without rising prices the housing market and commercial real estate is toast. Think of all those upside down homeowers who are holding on waiting for the market to turn around so they can sell or refinance________________ flat line. What’s a sales pitch to buy commercial real estate sound like these days without the expectation of a rising price, at least higher than the other rising costs associated with ownership? ________ flat line. After the sound of a flat line comes the sound of a dull thud as investors and homeowers hit the floor passing out while holding their breath waiting for things to turn around.
I think it was around the time gold went from $400 to $450 (And I thought it was too high to buy, it’ll come down soon – haha ouch) that Greenspan said the high prices were All due to the trouble being stirred up in the Middle East. Now suddenly he’s sounding like a gold bug saying… well, everything he is quoted as saying here makes him sound like a gold bug:
http://www.bloomberg.com/apps/news?pid=20601083&sid=acrGvxBXPDfk
Yes – I can’t believe she sounds so optimistic..
I’m working on a piece on the propaganda effort since March about the economy..
Talk about viral memes..
(green shoots).
That’s hilarious. Does anyone listen to Greenspan anymore? Just last spring he was proclaiming that equities would lead to recovery:
http://blogs.ft.com/capitalismblog/2009/03/30/equities-show-us-the-way-to-recovery/