Global economy: fighting for fiscal future | Pakistan Today | Latest news, Breaking news, Pakistan News, World news, business, sport and multimedia

Global economy: fighting for fiscal future | Pakistan Today | Latest news, Breaking news, Pakistan News, World news, business, sport and multimedia: Uncertainty
The world economy faces exceptional – perhaps, even unprecedented uncertainty. A growing prevalence of convenience and snacking will make eating on-the-go, the new “normal” as it enters 2012. The rebound in output among developed countries has proven feeble, yet fiscal austerity, especially in the eurozone. The collective austerity of developed economies will likely bring on one of the most severe fiscal contractions in many years. These effects will be partly offset by developing countries, although growth is moderating as global financial conditions deteriorate.
 Global perspective
Euromonitor International has forecasted a turbulent period ahead. It wrote, “World growth will slow down in 2012 amid ongoing sovereign risk and austerity programme. The by 3.8 per cent in real terms in 2012, down from 3.9 per cent in 2011 and 5.2 per cent in 2010. The slowdown might be attributed to financial instability and fears of sovereign risk, which threaten to spread beyond a few European economies. In other developed countries (such as the USA), policy indecision exacerbates uncertainty. As a result, stimulus programmes launched in 2010-2011 are being replaced by austerity measures.” Euromonitor expects developed countries to grow by 1.6 per cent in 2012 in real terms. Such an outcome would be below historical trends and several economies are likely to experience sharp slowdowns, notably in the eurozone, where sovereign risk is high. Collectively, advanced economies will slip into a synchronised slowdown as the loss in confidence spreads to consumers, bankers and investors.

World's economic leaders play games with other people's chips

World's economic leaders play games with other people's chips: In 2011 the world woke up once again to their naivety, this time for their misplaced trust in the infallibility of the Western democratic system. This summer, the ratings firm Standard & Poor's cut the US' top-tier AAA credit rating after the world's largest economy took itself to the brink of default due not to economic weakness but to political brinkmanship between the two major parties.

To highlight the turmoil the Western world went through this year, the once unimaginable downgrade of the US that should have been the financial event of the decade now comes almost as an afterthought compared to the near collapse of the European common currency, after a series of mistakes by political leaders that started to unfold during the summer.

The severe potential consequence is not the true similarity between these two events but the fact that they both resulted not from inevitable national or financial conditions as much as from the failure of politicians to do what's right, even in the face of an economic apocalypse.

Unrelenting Global Economic Crisis: A Doomsday View of 2012

Unrelenting Global Economic Crisis: A Doomsday View of 2012: Specifically, the crises wracked European Union will break up and the de facto multi-tiered structure will turn into a series of bilateral/multi-lateral trade and investment agreements. Germany , France , the Low and Nordic countries will attempt to weather the downturn. England - namely the City of London, in splendid isolation, will sink into negative growth, its financiers scrambling to find new speculative opportunities among the Gulf petrol-states and other ‘niches’. Eastern and Central Europe, particularly Poland and the Czech Republic , will deepen their ties to Germany but will suffer the consequences of the general decline of world markets. Southern Europe ( Greece , Spain , Portugal and Italy ) will enter into a deep depression as the massive debt payments fueled by savage assaults on wages and social benefits will severely reduce consumer demand.