Aren't we already in a recession? I mean if you take nominal GDP - CPI = real GDP. Which at this point is close to 0%- the economy already "recessing" from the more normal 3-4% long term GDP growth. Strong employment was the only thing that held up in this economy and that picture is looking bleak, figuratively and literally.However, the international industrial companies are doing quite well. Honeywell, 3M, GE, United Technologies, Textron are all doing quite well. The weak dollar definitely help the exports and international business. Could it really be that the rest of the world are "decoupling" from the U.S.?
China has built quite a huge foreign reserve in the last couple years- now all of those reserve are being deployed in finding energy resources (look how aggressive the Chinese oil companies are in acquiring foreign oil companies- Sinopec/CNOOC) and infrastructure building- these are capital investment that flow back to the economy. Can it be that China and other developing economies can hold up (because of infrastructure investment) while U.S. is slacking?
3 comments:
In energy development China is leaving the U.S. behind like the latter is standing still. Disgusting, the extent to which political forces in an advanced, industrialized country can threaten the whole balance.
It depends on what exactly you mean by energy development. In terms of building infrastruture to support their massive use of coal, yes China is advancing. They are simply advancing because the U.S. is no longer as dependent on the dirty fuel we once were. I must disagree that the U.S. is standing still in energy development. If you look at venture capital activity in the last few years, there has been 2 developments. One is the heavy investments in Web 2.0 and the other being in green energy development like biofuel, solar, and wind power. China still have much to learn. It's already evident in the air quality of its industrious cities like Beijing, Shenzhen etc. One only needs to understand the plight of 2008 Olympicians to understand the dire need for the Chinese to straighten their dirty energy ways.
Post a Comment