No Growth?

quarta-feira, outubro 09, 2013 David Barradas 1 Comments

From FT

The world faces years of sluggish growth unless leading economies undertake difficult economic reforms, the International Monetary Fund warned on Tuesday in a downbeat World Economic Outlook.

Launching its twice-yearly forecasts amid rising tensions over the US government shutdown, the fund trimmed its predictions of global expansion for 2013 and 2014 with all of the downgrade stemming from weaker prospects in emerging economies.

The message from the IMF to finance ministers and central bankers ahead of this week’s autumn meeting was that they must raise their game if the world economy is to return to the 4 per cent plus growth rates it enjoyed before the crisis.

http://www.ft.com/intl/cms/s/0/26a0c9d0-2ff3-11e3-9eec-00144feab7de.html?siteedition=intl#axzz2h7kU44tI

Like the IMF i see no growth in the world for the simple reason that there is too much of everything. There is excess supply of almost every product i can think of. If this is the case why build a new factory or a new plant. Current factories are working at 50% why build another one?

There is not enough demand in the world!

If credit could expand even more, we can always create demand but almost every part of the world is already overleveraged.

I see low growth & deflation. QE is not going to stop soon.