Skip to comments.Denial, Panic And Doubt In Davos
Posted on 01/27/2013 7:31:20 AM PST by blam
Denial, Panic And Doubt In Davos
January 27, 2013
First there was denial, then panic, then hope now there is nagging concern this downturn simply won't come to an end.
The World Economic Forum annual meeting in Davos. Photograph: Laurent Gillieron/EPA
Davos has been through some violent mood swings these past five years. First there was denial. Then there was panic. Then there was hope that the worst was over. Now there is nagging concern that this downturn simply won't come to an end.
Each year the consultancy firm PwC conducts a survey of the great and good of the business world. The message this year is that the improvement in sentiment seen in 2011 and 2012 has stalled. As far as business confidence is concerned there is a global double-dip recession.
It's not hard to see why. Everywhere executives look there are problems: real or prospective. In Europe, it is the impact of austerity programmes on growth and the frightening levels of joblessness. In India, it is inflation. In the United States, it is the fiscal cliff. In Japan, it is the prospect of a global currency war triggered by Tokyo's attempts to drive down the value of the yen.
David Cameron has done his bit to add to the uncertain mood. Announcing that Britain will have an in-out referendum on membership of the European Union in 2017 ensures four years in which foreign companies will be hesitant about investing in Britain.
Unsurprisingly perhaps, the PwC report shows that expectations about strong growth in 2013 are highest in the emerging world and lowest in Europe and Japan, where recent performance has been weak.
Dennis Nally, chairman of PwC International, said executives remained cautious about their short-term prospects and the outlook for the global economy.
(Excerpt) Read more at guardian.co.uk ...
"I put it on the growing list of things that are suggesting that the Fed is pondering a change in direction. If there are any tea leaves in the analysis, they would read that QE is going to be ending pretty soon."
It will keep grinding down the productive economies until it is dealt with (i.e. dismantled).
"The World Economic Forum's annual meeting broke up on Saturday night amid warnings that attendees were too relaxed and optimistic about the state of the global economy."
Socialism is like dragging dead weight around. Eventually it saps a country’s energy until it threatens its very existence. You’re absolutely right, its a grinding down process.
How Iceland Overthrew The Banks: The Only 3 Minutes of Any Worth from Davos:
“Why do we consider banks to be like holy churches?” is the rhetorical question that Iceland’s President Olafur Ragnar Grimson asks (and answers) in this truly epic three minutes of truthiness from the farce that is the World Economic Forum in Davos. Amid a week of back-slapping and self-congratulatory party-outdoing, as John Aziz notes, the Icelandic President explains why his nation is growing strongly, why unemployment is negligible, and how they moved from the world’s poster-child for banking crisis 5 years ago to a thriving nation once again. Simply put, he says, “we didn’t follow the prevailing orthodoxies of the last 30 years in the Western world.” There are lessons here for everyone - as Grimson explains the process of creative destruction that remains much needed in Western economies - though we suspect his holographic pass for next year’s Swiss fun will be reneged...
QE has been pushed out of the DC conversation, while it carried Obama through the election and lingers on life support today, a ruse to delay reality. The ultimate sucker punch to the opposition, creating the required false atmosphere of fiscal status quo for any hope of getting the One re-elected. Now the ruse evaporates, right on time.
In 2006, there was Iceland bragging over its vast growth and ability to be a global player. So they fall apart in 2008, with Icelandic people refusing to compensate anyone who held stock in the Icelandic banks that went bust. Now, they openly talk of the great recovery, the great new market, etc. A meteor could strike the island and take out 99 percent of the population....and yet some guy would show up at Davos the next year and comment on the great recovery of Icleand, and how it was a fine place to invest.
I'm listening to a radio program presently that is titled,"2013, The Best Year EVER To Buy A House/Home"