Growth Is Just Fine, It’s the Expectations That Are Messed Up

Credit Suisse, via Business Insider, comes at the point I’ve been making around here for some time from another angle. The bottom line is kwitcherbellyachin:

Through all the speed up and slowdown scares and microscopic inspection of economic data in the last 18 months, the global economy seems to have regained the growth rates it enjoyed in the first half of the decade, before the financial crisis and the recession. We expect global GDP to expand by 4.7% in 2010 and 4.3% in 2011 (Exhibit 2). This compares well enough with 4.6% growth in the five pre-crisis years 2003-07. For reference, October consensus expectations for 2010 and 2011 global GDP growth were 4.6% and 4.1%, respectively. The corresponding IMF forecasts are 4.8% and 4.2%.

And it’s not just the global economy; the economies of developed countries are growing at a good rate, viz:

The developed economies, including that of the United States, are growing at the respectable rate of between 2 and 3%.

Why the anxiety? It is because that’s not a fast enough rate to put those who’ve lost their jobs during the downturn back to work and we’re not nearly as rich as we thought we were going to be at this juncture. Ultimately, expectations need to be adjusted to what can reasonably be achieved.

2 comments… add one
  • john personna Link

    What’s really troubling is that unemployment has been “ringing” into a stable level. A stable high level.

  • steve Link

    When I look at the global numbers, I still wonder about the European debt overhanging everything and the currency issues with China/SE Asia. it doesnt feel like a very clean recovery.


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