Hi ild, key highlights from the article, Global Recession -- Longer and Deeper
Stephen Roach (New York)
morganstanley.com
...
"Needless to say, this downwardly revised prognosis -- 1.9% average growth in world GDP over the 2001-02 period -- depicts a world in deep recession. After all, 2.5% growth is usually viewed as the global recession threshold. Moreover, if the verdict ultimately falls at the lower end of our new risk range, it would qualify as the worst global recession of the post-World War II era -- both deeper and longer than the contractions of the mid-1970s and early 1980s."
..."a diversion of national output into increasingly unproductive channels such as defense, internal security, and increased insurance premiums...Absent the miraculous appearance of a new growth engine for a US-led global economy, I suspect the world economy will now move to a lower underlying growth trend -- an outcome that must have important implications for the longer-term earnings expectations embedded in equity markets."
"Second, and related to the first point above, we do not share the consensus view that inflation is about to accelerate."
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RE: "recession and inflation at the same time...and betting my money based on it."
I'm curious, how are you betting on this type of scenario?
Regards,
Amy J |
