Recession is fine, as long as there is no inflation, recession means we are recovering. Think of it as if you are sick and got a fever, but now you are taking medicine which makes you sweat a lot more. Normally in a healthy person that much sweat is not nice, you would consider that is a bad thing, but in this case a sick person would know it's there to drop their fever by sweating.
This is the same, it is a distasteful thing to have recession, we would prefer not to have it, but if fixes all the inflation issues and goes away in a year then it's good. Remember that period between 2008 crisis and 2011? We went from trouble to nice slowly, it could be that slow again.
Topic: Third of world economy to hit recession in 2023, IMF head warns - page 2. (Read 209 times)
January 05, 2023, 04:55:01 PM
January 05, 2023, 04:08:25 AM
initially this recession was only limited to speculation,, but it seems that the issue of this recession has become a reality, especially the statement from the IMF, which is increasingly making people panic and withdrawing their assets from the stock market, and this will create a domino effect and make the recession itself come faster
January 04, 2023, 08:06:15 PM
The UK has odd statistics on this now (it could be similar across Europe). There's a recession on paper but I don't think it's being felt too much as vacancies are apparently high (I assume this means there's lots of legitimate job ads - there might not be though, a lot of companies try to survive with one person doing the job of the team around them that quit for as long as possible).
I don't think the brics were that well coupled anyway. Especially looking at China v India over the past few years, they seem to have diverged quite a bit and grow at different rates. The parity of those countries might remain the same but that can be said of most economies anyway. The last report from the US I looked at which tracked global economies seemed to suggest a weak euro would mean for a strong yen (it only tracked Europe, the UK, Japan and the US but I wonder how far that stretches out to other countries around Japan and who's economy they'll track).
I don't think the brics were that well coupled anyway. Especially looking at China v India over the past few years, they seem to have diverged quite a bit and grow at different rates. The parity of those countries might remain the same but that can be said of most economies anyway. The last report from the US I looked at which tracked global economies seemed to suggest a weak euro would mean for a strong yen (it only tracked Europe, the UK, Japan and the US but I wonder how far that stretches out to other countries around Japan and who's economy they'll track).
January 04, 2023, 07:59:44 PM
China is just coming out of its lockdown attempts, the opposite can happen is a story today I have also seen a warning about. Despite the best attempts of many western governments to restrict the circulation of excess money printed in prior years, there has been little quantitative tightening actually done just these rate rises which is something else. The longer term picture still contains excessive currency, if China is back to its full use and production it will raise many commodity markets and in turn we are less likely to see a lull in demand within markets.
I agree thats likely but what % of those cases are serious life threatening is going to be quite low, though it might be callous to say perhaps as any deaths are serious it should not be enough vs a working population to be restrictive to the economy or economic productivity. Whereas a lockdown situation done in a blanket way for years now has been excessive in its effects.
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“bushfire” of expected Covid infections
I agree thats likely but what % of those cases are serious life threatening is going to be quite low, though it might be callous to say perhaps as any deaths are serious it should not be enough vs a working population to be restrictive to the economy or economic productivity. Whereas a lockdown situation done in a blanket way for years now has been excessive in its effects.
January 04, 2023, 07:34:16 PM
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China’s lagging growth a key threat this year, IMF managing director Kristalina Georgieva said, while the US is ‘most resilient.’
For much of the global economy, 2023 is going to be a tough year as the main engines of global growth – the US, Europe and China – all experience weakening activity, the head of the International Monetary Fund has warned.
The new year is going to be “tougher than the year we leave behind,” IMF managing director Kristalina Georgieva said on the CBS Sunday morning news program Face the Nation on Sunday.
“Why? Because the three big economies – the US, EU and China – are all slowing down simultaneously,” she said.
“We expect one-third of the world economy to be in recession. Even countries that are not in recession, it would feel like recession for hundreds of millions of people,” she added.
In October, the IMF cut its outlook for global economic growth in 2023, reflecting the continuing drag from the war in Ukraine as well as inflation pressures and the high interest rates engineered by central banks like the US Federal Reserve aimed at bringing those price pressures to heel.
Georgieva said that China, the world’s second-largest economy, is likely to grow at or below global growth for the first time in 40 years as Covid-19 cases surge following the dismantling of its ultra-strict zero-Covid policy.
“For the first time in 40 years, China’s growth in 2022 is likely to be at or below global growth,” Georgieva said.
Moreover, a “bushfire” of expected Covid infections there in the months ahead are likely to further hit its economy and drag on both regional and global growth, said Georgieva, who traveled to China on IMF business late last month.
“For the next couple of months, it would be tough for China, and the impact on Chinese growth would be negative, the impact on the region will be negative, the impact on global growth will be negative,” she said.
Meanwhile, Georgieva said, the US economy is standing apart and may avoid the outright contraction that is likely to afflict as much as a third of the world’s economies.
The “US is most resilient,” she said, and it “may avoid recession. We see the labour market remaining quite strong.”
“This is … a mixed blessing because if the labour market is very strong, the Fed may have to keep interest rates tighter for longer to bring inflation down,” Georgieva said.
The US job market will be a central focus for Federal Reserve officials who would like to see demand for labour slacken to help undercut price pressures. The first week of the new year brings a raft of key data on the employment front, including Friday’s monthly nonfarm payrolls report, which is expected to show the US economy minted another 200,000 jobs in December and the jobless rate remained at 3.7% – near the lowest since the 1960s.
https://www.theguardian.com/business/2023/jan/02/third-of-world-economy-to-hit-recession-in-2023-imf-head-warns
For much of the global economy, 2023 is going to be a tough year as the main engines of global growth – the US, Europe and China – all experience weakening activity, the head of the International Monetary Fund has warned.
The new year is going to be “tougher than the year we leave behind,” IMF managing director Kristalina Georgieva said on the CBS Sunday morning news program Face the Nation on Sunday.
“Why? Because the three big economies – the US, EU and China – are all slowing down simultaneously,” she said.
“We expect one-third of the world economy to be in recession. Even countries that are not in recession, it would feel like recession for hundreds of millions of people,” she added.
In October, the IMF cut its outlook for global economic growth in 2023, reflecting the continuing drag from the war in Ukraine as well as inflation pressures and the high interest rates engineered by central banks like the US Federal Reserve aimed at bringing those price pressures to heel.
Georgieva said that China, the world’s second-largest economy, is likely to grow at or below global growth for the first time in 40 years as Covid-19 cases surge following the dismantling of its ultra-strict zero-Covid policy.
“For the first time in 40 years, China’s growth in 2022 is likely to be at or below global growth,” Georgieva said.
Moreover, a “bushfire” of expected Covid infections there in the months ahead are likely to further hit its economy and drag on both regional and global growth, said Georgieva, who traveled to China on IMF business late last month.
“For the next couple of months, it would be tough for China, and the impact on Chinese growth would be negative, the impact on the region will be negative, the impact on global growth will be negative,” she said.
Meanwhile, Georgieva said, the US economy is standing apart and may avoid the outright contraction that is likely to afflict as much as a third of the world’s economies.
The “US is most resilient,” she said, and it “may avoid recession. We see the labour market remaining quite strong.”
“This is … a mixed blessing because if the labour market is very strong, the Fed may have to keep interest rates tighter for longer to bring inflation down,” Georgieva said.
The US job market will be a central focus for Federal Reserve officials who would like to see demand for labour slacken to help undercut price pressures. The first week of the new year brings a raft of key data on the employment front, including Friday’s monthly nonfarm payrolls report, which is expected to show the US economy minted another 200,000 jobs in December and the jobless rate remained at 3.7% – near the lowest since the 1960s.
https://www.theguardian.com/business/2023/jan/02/third-of-world-economy-to-hit-recession-in-2023-imf-head-warns
....
Could we witness a decoupling of BRICS (Brazil, Russia, India, China, South Africa) economies? Where some select BRICS nations continue to do well economically, while others trend in the opposite direction?
Reading between the lines, it seems that many nations of the world are taking steps to insulate their native economies from asset and financial contagion. As well as protect themselves against other negative trends associated with declines of the world's largest consumer (USA) and export (china) markets. Although I haven't seen it officially announced, it seems that gold is being bought up in record volumes by major nations of the world who plan to use it as a stablecoin to protect trade against inflation.
Is it fair to say modern day economies have more tools at their disposal to insulate and protect their economy from recession, in contrast to those of previous eras? While fossil fuels and global trade have made modern economies more flexible with larger margins for error? With the internet making communications and data more accessible and abundant with technology like blockchain based open ledgers.
All of which might mean future recessions won't be as bad as they would have had they occurred a century or two in the past.
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