Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: Haim R. Branisteanu who wrote (49044)	4/23/2009 2:34:14 PM
From: elmatador	Read Replies (1) \| Respond to of 217830

The Global Economy In The Next Year Nouriel Roubini, 04.23.09, 12:00 AM EDT More contraction in growth--and more job losses. The global economy is in the middle of a synchronized contraction that will push global growth into negative territory in 2009 for the first time in decades. This will be the worst financial crisis since the Great Depression and the worst global economic downturn in decades. Global trade volumes face their sharpest contractions of the postwar era--trade is expected to contract 12% in 2009 due to the severe and prolonged slump in global demand, excess capacity across supply chains and the continued crunch in trade finance. Many analysts and commentators are pointing out that the second derivative of economic activity is turning positive (i.e., economies are still contracting, but at a slower rather than accelerated rate) and that the green shoots of an economic recovery are peeping out. My analysis of the data suggests that the global economic contraction is still in full swing with a very severe, deep and protracted U-shaped recession. Last year's economic consensus forecast of a V-shaped short and shallow recession has vanished. While the rate of economic contraction is slowing compared to the free fall rates of the fourth quarter of 2008 and the first quarter of 2009, we are still a long way away from the economic bottom and from a sustained recovery of growth. In particular, in Europe and Japan there is little evidence of a positive second derivative of economic activity. However, by the end of the first quarter of 2009, there were some signs that the pace of contraction had slowed in many economies, especially in the U.S. and China, where policy responses have been more significant and leading indicators in the manufacturing sector may have bottomed before they did in Europe and Japan. However, major economies, including all of the G7, will continue to contract throughout 2009, albeit at a slower pace than at the beginning of the year. Moreover, the global recovery might be sluggish at best in 2010 given the overhang of the credit losses of financial institutions, the lingering credit crunch, the need for retrenchment by overstretched and over-indebted households in current-account-deficit countries, and a slow resumption of demand prompted by extensive government stimulus. Some key elements of my outlook include: --Global economic activity is expected to contract by 1.9% in 2009. Advanced economies are expected to contract 4% in 2009. Japan and the eurozone will suffer the sharpest downturns. U.S. gross domestic product will continue to contract, albeit at a slower pace throughout 2009, with negative growth in every quarter. --Emerging markets will slow down sharply from the stellar growth rates of the past few years, with the BRIC economies growing at half their 2008 pace. --Deteriorated terms of trade, slower capital flows and tighter credit will push Latin America into recession from the 4.1% growth of 2008. Argentina, Brazil, Chile, Colombia, Mexico and Venezuela will all shift to negative territory on a year-over-year basis, while smaller economies, like Peru, will experience a significant slowdown. --Countries in Eastern Europe and the sphere of Russia will experience some of the sharpest contractions given the withdrawal of foreign credit and the risk of a severe financial crisis. The reduction in oil revenues and financial stress will contribute to a 5% year-over-year contraction in Russia, and some countries--especially in the Baltics--are at risk of double-digit contractions --Export-dependent Asia's growth will slow significantly to less than 3% in 2009. China will have a hard landing with GDP growth falling to 5.5% while India will slow sharply to 4.3%. All four Asian Tigers (Singapore, Taiwan, South Korea and Hong Kong) as well as Malaysia and Thailand will experience recessions. --The Middle East and Africa will mark much slower growth, at half of their 2008 pace, given the reduction in capital inflows, reduced demand from the U.S. and E.U., and decline in commodity prices and output. Israel and South Africa will suffer slight contractions. --The unprecedented fiscal and monetary stimulus may help alleviate the substantial contraction in private demand and reduce the risk of a global L-shaped near-depression. Debt financing may be a challenge for many countries though, especially emerging markets or the most vulnerable Western European economies. --Job losses during the current global recession might exceed those in recent recession, contributing to increases in defaults and posing additional risks to banks. The unemployment rate in developed countries will reach double-digits by 2010 (as early as mid-2009 in the U.S.) and push more people in developing countries into poverty. Moreover, despite new funding from multilateral institutions, severe contractions will raise the risk of social and political unrest. --Commodities, as a class, are likely to come under renewed pressure in 2009, despite some support from production cuts. I expect the West Texas Intermediate (WTI) oil price to average about $40 a barrel in 2009, as demand destruction continues to outweigh crude supply destruction. Nouriel Roubini, a professor at the Stern Business School at New York University and chairman of Roubini Global Economics, is a weekly columnist for Forbes. (Analysts at Roubini Global Economics assisted in the research and writing of this piece.)

To: Haim R. Branisteanu who wrote (49044)	4/23/2009 8:49:01 PM
From: TobagoJack	2 Recommendations Read Replies (2) \| Respond to of 217830

just in in-tray, and i will chance the copyright issue and post scan of letter by ny attorney general cuomo marketwatch.com B. of A. says gov't threatened management 12:18 PM ET 4/23/09 \| Marketwatch NEW YORK (MarketWatch) -- Bank of America Chief Executive Ken Lewis said that the Treasury and the Federal Reserve threatened to remove him and the firm's board of directors if the company did not go through with a planned acquisition of Merrill Lynch late last year. According to the minutes of a December 22 meeting, which were released Thursday by New York Attorney General Andrew Cuomo, the government made the threat when the bank was considering invoking a "material adverse change" clause to quash the deal after it became clear Merrill's finances were collapsing. According to the minutes, Lewis, told the board that, "the Treasury and Fed stated strongly that were the corporation to invoke the material adverse change clause in the merger agreement with Merrill Lynch and fail to close the transaction, the Treasury and Fed would remove the board and management of the corporation."