My general take on the economic outlook is more bullish of late. I believe the data are surprising to the upside now so much that you can forget about a real economy-based double dip. This is also a major reason bonds are getting whacked. Global economic weakness is now fully concentrated in the US housing sector and the European sovereign debt crisis. My expectation is that only a very large exogenous shock which brings these crises to a flash point would create a double dip in 2011, my previous baseline. To date, we have navigated through this recovery without the policy choices that would have led to double dip. So, a multi-year recovery seems to be in the offing. Nevertheless, the underlying fundamentals in the developed economies are weak, meaning that the debt problems will swamp the cyclical upturn at the first sign of economic weakness.
Below are three views on the economic outlook in the US, globally, and in India plus the rest of the links.
2011 Economic Outlook
- Rosenberg: Ten Investment Themes for 2011
- Will India GDP grow by more than 10% in this Financial Year? | Global Economic Intersection
- What Lies Ahead in 2011? by Joseph E. Stiglitz – Project Syndicate
Credit Writedowns
- Outlook for Swiss National Bank
- Eurozone Contagion: Moody’s Moves Belgium To Negative Outlook
- Dollar Down for a Second Day Ahead of FOMC Meeting
- Former US Treasury Secretary Paul O’Neill Calls George W. Bush a Liar on Bloomberg
- ECB: Where is the Shock and Awe?
Credit Crisis
- Carney: Nobody wants to crash this debt party – National Post
- How The Bailouts Hurt Small Banks and Benefited Big Finance. « Rortybomb
- Two U.S. banks reveal TARP repayment plans | Reuters
- Defaults Account for Most of Pared Down Debt – Real Time Economics – WSJ
- A Terrible Way To Fix The Economy: Households Deleveraging Through Defaulting on Debt. « Rortybomb
- Finanzkrise – Der deutsche Monster-Kredit – Geld – sueddeutsche.de
- “Crime Shouldn’t Pay”: Tell the State AGs You Want Mortgage Fraud Prosecuted « naked capitalism
- Default and bankruptcy in the municipal bond market (part one) « self-evident
The Usual Fare
- Inflation hit 3.3% in November | Business | guardian.co.uk
- BBC News – US retail sales rise in November
- FT.com – Currencies: Yuan direction
- FT.com – Cuba bows to pressure to reform its economy
- Economics: Why are government bond yields rising? – The Economist
Tech Stuff and Other Links
- BBC News – Google online search adverts ‘dominant’, says France
- With Chrome, Google Is Moving Towards Deeper Location Integration
- Why Can Some Blind People Process Speech Far Faster Than Sighted Persons?: Scientific American
- Virginia health-care ruling strikes down key provision of Obama’s plan
- What Makes an Honest Smile Honest?: Scientific American Podcast