Monday, March 2, 2009

World Growth To Be Negative In 2009 For First Time Since WW II

Previously here I reported on the IMF forecast of a positive one half of one percent world GDP growth rate, the worst since WW II. Now, given more rapid declines in US, UK, EU, and much of Asia, there is a forecast for 2009 that has that now at about a negative one half of one percent, the first actually negative global growth rate since WW II. This new projection is by the chief economist of BNP-Paribas, Philippe d'Arvusenet, at a site with the longest url I have ever seen (.pdf).

Anyway, whether or not I got that url right, this is not good news.

8 comments:

wellbasically said...

Oh Jesus.

TheTrucker said...

We must flood the world with money. The intent is not "to force an economic recovery", but to devalue the ill gotten gains of the shysters that sold all the snake oil. Dressing up the effort as a "recovery package" makes political sense but for the fact that the current package is insufficient and the same people who currently have the "ill gotten gains" will (at least in the beginning) end up with all the new money. It will then become a question of "how fast can we devalue this money so as to reclaim some amount of justice?". If justice is the objective then the current money will need to be replaced with honest earnings. Stabilizing the current dollar is the worst thing that can be done, yet it seems to be exactly what is happening.

rosserjb@jmu.edu said...

Trucker,

The problem with the dollar is a rerun of what happened last September. When people really freak out, they run to the dollar as a "safe haven," absurd as this is in the face of our humongous current account deficits. But there it is, and in the last week or so, the global scale of how bad things are and how much worse they are getting has hit across the board and around the world, triggering another round of this panicky dollar buying.

As a variation on what wellbasically said, many are saying "oh s**t".

wellbasically said...

I'm more worried now about the political situation.

Brenda Rosser said...

this period shocks me about as much as I was the moment I was born.

rosserjb@jmu.edu said...

Regarding the politics of this, what worries me is that at best the stimulus package will only slow, or at best halt, the decline that is now accelerating. This will in fact mean that it "worked," in the sense of avoiding possibly millions of layoffs. But, those people will not associate their still having a job with the stimulus. People will not see "jobs gained," and the critics will use this to claim that Obama failed. Whether this will end up with a bouncing Limbaugh in charge of everything or who knows what, well, we are in for some rough times ahead, and getting rougher.

wellbasically said...

Sorry I wasn't clear... I meant riots and wars. Something is going to hit us out of left field.

Sandwichman said...

Regarding the politics of this...

As good a reason as any for uncoupling the do-able social outcome of full employment from the abstract economic outcome of "growth".

Economist discourse rolls merrily along with the assumption of a growth imperative. It's a FUCKING STUPID assumption, boys and girls. The keys are over there in the working time bushes where you dropped them not under the economic growth lamp post where "the light is better."