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Global Economic Downturn to Continue? (Read 97599 times)
corporate_whitey
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Re: Global Economic Downturn to Continue?
Reply #735 - Jan 5th, 2012 at 7:53am
 
Governments and Industry need to recognize that profit has no place in the modern age. Cool  Its the end of Profit and Bonuses as we know it....
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World Wide Working Class Struggle
 
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Re: Global Economic Downturn to Continue?
Reply #736 - Jan 5th, 2012 at 9:52am
 
corporate_whitey wrote on Jan 5th, 2012 at 7:53am:
Governments and Industry need to recognize that profit has no place in the modern age. Cool  Its the end of Profit and Bonuses as we know it....



That's dead set right CW. We are coming into a new era of sustained economy.

Goodbye reserve banks and associated Ponzi schemes.
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"When the power of love overcomes the love of power, the world will know peace." Hendrix
andrei said: Great isn't it? Seeing boatloads of what is nothing more than human garbage turn up.....
 
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Re: Global Economic Downturn to Continue?
Reply #737 - Jan 8th, 2012 at 11:16am
 
U.S. Non-Farm Payrolls: The Statistical Illusion Of Jobs


The Employment Report for December 2011 was released today with a glowing press release from the BLS (Bureau of Labor Statistics). The highlight of the report was the 42,000 courier and messengers jobs created last month and the claim that the unemployment rate fell to 8.5%.

Statistics can easily be manipulated and it is not unknown for political regimes to do so in order to hold on to power (and 2012 is an election year in the U.S.). After all, it is much easier to change a number than to fix the underlying problem the number represents. Fortunately, the BLS publishes a number of statistical tables with each monthly report that can be used to check its calculations.

When the Great Recession began in December 2007, the civilian non-institutional population of the United States was 189,993,000. At that time, the number of people in the U.S. labor force was 125,588,000. As of December 2011, the BLS states that the employment population ratio for the U.S. is 58.5% (0.585). The non-institutional population of the U.S. was reported at 193,682,000 or 3,689,000 higher than it was in December 2007. The labor force in December 2007 was 125,334,000 and multiplying the increase in the U.S. population in the intervening four years by the employment population ratio indicates that the labor force should have increased by 2,158,000 to 127,492,000. However, the BLS reports the U.S. labor force last month was 124,114,000. More than three million people are missing from its figures.

The smaller the labor force is, the better the headline unemployment rate becomes. The BLS claims these 3 million plus people left the labor force and this justifies purging them from the statistics. There is a problem with their line of reasoning, however. Large numbers of people only leave a labor force during periods of severe economic distress. It does not happen during economic recovery. It does not indicate an employment situation that is improving. Yet, the BLS produces numbers showing things are getting better when this happens. This violates the first rule of statistics - the results must reflect reality. The BLS numbers do not.

Dividing the number of employed in December 2011 by the size of the labor force that should exist based on the population numbers produces an unemployment rate of 9.6%, not 8.5%. This is the headline number that should be reported.

If the BLS wants to insist however that more than three million people have indeed left the labor force (and this has continued in the last year - the size of the labor force in December 2011 is smaller than it was in December 2010), it should also make it clear that this indicates that there has been an ongoing recession and no economic recovery has taken place. Both can't happen at the same time, except for a brief period. Either the economic recovery story is a lie or there hasn't been a shrinking labor force.

If you think about it, the term jobless recovery makes as much sense as tall midget or genius moron.

What is keeping the U.S. economy from getting worse is the unprecedented budget deficits that the U.S. is running. If you spend an extra $1.3 trillion dollars that you don't have as the U.S. did in 2011, this will certainly stimulate the economy in the short-term since much of this money winds up in consumer pockets and they spend it.

Link -
http://seekingalpha.com/article/317954-u-s-non-farm-payrolls-the-statistical-ill...
=================================
The numbers that really matter -
1) Total Population.
2) Total Employed. 
3) The ratio between 1 & 2.

The above 3 figures are the real indicators of the health or otherwise of not only the jobs market, but to a degree, the Economy as a whole!

The ripple effect spreading out from these numbers affects many issues, such as the Demand for Goods & Services, whether the level of Taxes raised is sufficient.


In looking at 2 and the ratio between 2 & 1, special consideration should be given to the actual & possible effects of the current & future retirements of the Baby Boomer generation, due to the massive numbers involve, which will average some 10,000 per day, over the next 2 decades in the USA. This Boomer effect will also be applicable in most other countries, around the world.

Whilst the Unemployment figures obviously matter, particularly at a personal level, they will not necessarily be a good indicator of the overall health of the jobs market or of the Economy as a whole, particularly on a monthly basis, where figures can be skewed by seasonal or other factors and the effects of Boomer retirements!

The net Growth in 1 (Population) is slowing and will continue to slow, as birth rates continue their multi decade decline, as immigration slows & possibly goes into reverse with slowing job opportunities and finally as the Boomer generation age, then die in ever increasing numbers over the next 20 years.

The Total Employed has already gone into reverse, in the USA & some European countries, notwithstanding that the Total Population levels in most countries has still been increasing, albeit at a slower rate than previously.

The ratio between Total Employment & Total Population levels has also been in Decline and that is likely to continue, as massive numbers of Baby Boomers move into retirement, thus allowing possible reductions in the Unemployment ratio's, unless the Economy deteriorates further, which is also likely, as Demand for all sorts of Goods & Services falls, as Boomers reign in spending funds they "discover" they don't have.

All of which will greatly exacerbate government Tax Revenue & Debt situations!

But bear in mind, we didn't yet raise the effects of the other major Economic influences on the "new Economy", which are -
1) Peak Energy
2) Peak Debt
3) Peak Climate 

So, welcome to the "New Economy"?
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Re: Global Economic Downturn to Continue?
Reply #738 - Jan 10th, 2012 at 11:23pm
 
Population: The Elephant in the Room; Peak Oil Implications on Population Growth; What Level of Human Population is Sustainable?


"In the last 200 years the population of our planet has grown exponentially, at a rate of 1.9% per year. If it continued at this rate, with the population doubling every 40 years, by 2600 we would all be standing literally shoulder to shoulder." says Professor Stephen Hawking as reported by Edward Morgan in Looking at the New Demography.


Suffice to say the rate of population growth will not continue, and Morgan makes the case we are already in stage 5 of
The Demographic Transition Model
...

Peak Oil Implications on Population Growth

Whereas Morgan presents a relatively benign view of things, even wondering if there are ways to reverse stage 5 decline, Paul Chefurka in Population: The Elephant in the Room sees things quite differently, primarily because of oil usage.

Each of the global problems we face today is the result of too many people using too much of our planet's finite, non-renewable resources and filling its waste repositories of land, water and air to overflowing. The true danger posed by our exploding population is not our absolute numbers but the inability of our environment to cope with so many of us doing what we do.

It is becoming clearer every day, as crises like global warming, water, soil and food depletion, biodiversity loss and the degradation of our oceans constantly worsen, that the human situation is not sustainable. Bringing about a sustainable balance between ourselves and the planet we depend on will require us, in very short order, to reduce our population, our level of activity, or both. One of the questions that comes up repeatedly in discussions of population is, "What level of human population is sustainable?"

Oil first entered general use around 1900 when the global population was about 1.6 billion. Since then the population has quadrupled. When we look at oil production overlaid on the population growth curve we can see a very suggestive correspondence:
...

A closer look at the two curves from 1900 to the 2005 reinforces the impression of a close correlation:
...

The first questions everyone one asks when they accept the concept of Peak Oil is, "When is it going to happen?" and "How fast is the decline going to be?"

The steepness of the post-peak decline is open to more debate than the timing of the peak itself. There seems to be general agreement that the decline will start off very slowly, and will increase gradually as more and more oil fields enter decline and fewer replacement fields are brought on line. The decline will eventually flatten out, due both to the difficulty of extracting the last oil from a field as well as the reduction in demand brought about by high prices and economic slowdown.

The post-peak decline rate could be flattened out if we discover new oil to replace the oil we're using. Unfortunately our consumption is outpacing our new discoveries by a rate of 5 to 1. to make matters worse, it appears that we have probably already discovered about 95% of all the conventional crude oil on the planet.

A full picture of the oil age is given in the graph below. This model incorporates actual production figures up to 2005 and my best estimate of a reasonable shape for the decline curve. It also incorporates my belief that the peak is happening as we speak.
...

In ecology, overshoot is said to have occurred when a population's consumption exceeds the carrying capacity of its environment, as illustrated in this graphic:
Overshoot
...

Populations in serious overshoot always decline. This is seen in wine vats when the yeast cells die after consuming all the sugar from the grapes and bathing themselves in their own poisonous alcoholic wastes. It's seen in predator-prey relations in the animal world, where the depletion of the prey species results in a die-back of the predators. Actually, it's a bit worse than that. The population may actually fall to a lower level than was sustainable before the overshoot. The reason is that unsustainable consumption while in overshoot allowed the species to use more non-renewable resources and to further poison their environment with excessive wastes.

In the case of humanity, our use of oil has allowed us to perform prodigious feats of resource extraction and waste production that would simply have been inconceivable before the oil age. If our oil supply declined, the lower available energy might be insufficient to let us extract and use the lower grade resources that remain. A similar case can be made for a lessened ability to deal with wastes in our environment.

The Cost
The human cost of such an involuntary population rebalancing is, of course, horrific. Based on this model we would experience an average excess death rate of 100 million per year every year for the next 75 years to achieve our target population of one billion by 2082. The peak excess death rate would happen in about 20 years, and would be about 200 million that year. To put this in perspective, WWII caused an excess death rate of only 10 million per year for only six years.

Given this, it's not hard to see why population control is the untouchable elephant in the room - the problem we're in is simply too big for humane or even rational solutions. It's also not hard to see why some people are beginning to grasp the inevitability of a human die-off.

UN Population Projections
Let's put aside the really grim projections and simply ponder the "low population track" in the following charts of population projections from the UN.
...

Demographic and Economic Questions
1. Is that low UN track that unbelievable? If not, what if the starting point is now, not 2040?
2. Who is going to pay the medical costs of all the retirees in the developed-world if people live longer and the population simply stagnates?
3. Where are the energy resources going to come from if the population keeps growing instead?
4. Where are the energy needs of China alone going to come from at the current rate of China's economic growth regardless of whether the Chinese population grows or not?

Those who think we are going to "grow" our way out the the current global economic mess better have good answers for the questions in points number one and three above.

Problem number two is a huge problem in Japan right now. Thee US will face the same problem not too far down the road.

Those who suggest immigration and population growth is the solution to problem number two better have an answer to question number three while also explaining how immigration and population growth is nothing more than a can-kicking exercise.

The China problem is right here, right now. Peak oil all but ensures China's growth rate is going to plunge in the not too distant future, there is going to be a huge global showdown over oil supplies with China the winner, or a cheap easy to produce means of renewable energy is found in the next five years?


Link -
http://globaleconomicanalysis.blogspot.com/2012/01/population-elephant-in-room-p...
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Re: Global Economic Downturn to Continue?
Reply #739 - Jan 14th, 2012 at 10:18am
 
Here's another dilemma, for these European countries at least. Italy, France and Spain are the main concerns, the others are relatively smallish economies that won't have as much impact on the global market.

.................................................................

S&P downgrades France and eight other eurozone members

Standard & Poor’s rating agency has downgraded France’s sterling AAA credit rating. Earlier on Friday the rumors of a downgrade had already sent markets plunging.

A total of nine countries have had their S&P ratings downgraded. France, Austria, Malta, Slovakia and Slovenia have seen their rating cut one notch, while Cyprus, Italy, Spain and Portugal have dropped two positions. Austria had also previously held a top AAA rating.

The US-based rating agency justified its decision pointing to a combination of economic and financial factors along with “insufficient” measures taken by European leaders in dealing with the crisis.

"Today's rating actions are primarily driven by our assessment that the policy initiatives that have been taken by European policymakers in recent weeks may be insufficient to fully address ongoing systemic stresses in the eurozone," said S&P. It also warned that austerity alone will not fix Europe’s financial woes.

French finance minister François Baroin has earlier spoken to France-2 television confirming the reports of the one notch downgrade. "It's not good news, but it's not a catastrophe," he said. "It's not ratings agencies that decide French policy."

France and Austria now have rating of AA+, the same as the United States has had since it was downgraded last August.

France though still has a top AAA rating from the other major rating agencies, Moody’s and Fitch.

Following the downgrade Italian bonds fell from A to BBB+, which is S&P's lowest so-called investment grade category. Spain fell to A from AA-.

Germany, Finland, the Netherlands and Luxembourg all managed to maintain their perfect AAA ratings.

Many European leaders have been quick to criticize credit ratings agencies for having a negative impact on the 17-nation monetary union at the very time it is attempting to avert a crisis.

­Political economist Jerome Roos told RT that the downgrade is just a subjective opinion by a powerful private institution and should be taken with “a grain of salt.” He warned that we should be really worried about the leverage and the power these subjective opinions ultimately have on the crisis and the ways of getting out of it.

“The power of these rating agencies dictates the discourse, the debate here in Europe. It allows them, to a certain extent, to dictate almost self-fulfilling prophecies. Ultimately, the downgrade is justified by the results of the impact of the downgrade itself.”

http://rt.com/news/france-credit-rating-downgrade-747/print/
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"When the power of love overcomes the love of power, the world will know peace." Hendrix
andrei said: Great isn't it? Seeing boatloads of what is nothing more than human garbage turn up.....
 
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Re: Global Economic Downturn to Continue?
Reply #740 - Jan 14th, 2012 at 11:25am
 
Ex Dame Pansi wrote on Dec 27th, 2011 at 3:35pm:
Quote:
andrei will love this;

abcnewsABC News
Brazil overtakes Britain as world's sixth-largest economy http://bit.ly/see7bG



The west has had its day vege. I'm sure glad that I won't be around when the east really take charge, karma and all that eeeewwww!!! they're sure gonna pay us back big time. Our poor grandchildren will be living in third world conditions, worse than our Indigenous peoples of today are forced to put up with.

I wonder where the white man will be in 100 years time? Non-existent perhaps????


Imagine a world without polar bears?

How many animal species have been rendered extinct because of mining?


Polar bears are smarter than white people. they're merging their genes with grizzlies and when 'white' becomes an advantage again they'll re-emerge Grin
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Re: Global Economic Downturn to Continue?
Reply #741 - Jan 14th, 2012 at 11:27am
 
Grey wrote on Jan 14th, 2012 at 11:25am:
Ex Dame Pansi wrote on Dec 27th, 2011 at 3:35pm:
Quote:
andrei will love this;

abcnewsABC News
Brazil overtakes Britain as world's sixth-largest economy http://bit.ly/see7bG



The west has had its day vege. I'm sure glad that I won't be around when the east really take charge, karma and all that eeeewwww!!! they're sure gonna pay us back big time. Our poor grandchildren will be living in third world conditions, worse than our Indigenous peoples of today are forced to put up with.

I wonder where the white man will be in 100 years time? Non-existent perhaps????


Imagine a world without polar bears?

How many animal species have been rendered extinct because of mining?


Polar bears are smarter than white people. they're merging their genes with grizzlies and when 'white' becomes an advantage again they'll re-emerge Grin




Grey - you sound like Archie Bunker:

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Re: Global Economic Downturn to Continue?
Reply #742 - Jan 14th, 2012 at 12:34pm
 
Bobby. wrote on Jan 14th, 2012 at 11:27am:
Grey - you sound like Archie Bunker:


Yeh, well Archies writer may be - now piss off this is a serious thread. Grin
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Re: Global Economic Downturn to Continue?
Reply #743 - Jan 14th, 2012 at 1:09pm
 
Grey wrote on Jan 14th, 2012 at 12:34pm:
Bobby. wrote on Jan 14th, 2012 at 11:27am:
Grey - you sound like Archie Bunker:


Yeh, well Archies writer may be - now piss off this is a serious thread. Grin



Grey - you've got to admit - that was a very funny video?
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Re: Global Economic Downturn to Continue?
Reply #744 - Jan 14th, 2012 at 8:55pm
 
...
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Re: Global Economic Downturn to Continue?
Reply #745 - Jan 14th, 2012 at 9:12pm
 
Well alright it was quite amusing. I prefer Alf Garnett for two reasons, he was the original and I knew John Speight, almost I could say John Speight was a friend of mine, though he was older enough to make that claim presumptious. But he was a good bloke and a great satirist.

One thing your video did was make me reflect on John Speight, who was working underclass through and through. That made him a better satirist than all those upper middleclass yobs like the Monty Python crew A lot of the python comedy is taking the piss out of the working class. John Speight took on the serious issues like racism. One of his plays, shown on the BBC  Was called 'If there wasn't any black people we'd have to invent them'. Which is true enough of course, coal miners, Jews, short or fat people can or have filled the function.
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Re: Global Economic Downturn to Continue?
Reply #746 - Jan 14th, 2012 at 9:15pm
 
Huh, went looking for an Alf clip and low and behold guess what I found. (sorry perceptions normal affairs will continue soon)

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Re: Global Economic Downturn to Continue?
Reply #747 - Jan 16th, 2012 at 7:58pm
 
How Global Oil Supplies Could Fall 40% Overnight


You’d never know it from the oil price, but the global seaborne oil supply might face a 40% cut. In the last few days the Brent Crude price has dropped from $115 to $110 a barrel, where it has spent much of the last three months.

So why could the global oil supply fall by 40% overnight?


Iran has threatened to block the Strait of Hormuz in response to US sanctions.

The Strait of Hormuz is the narrowest part of the Persian Gulf. Oil from producing countries like Saudi Arabia, Qatar, and the United Arab Emirates also ship their oil through the strait. All up, 40% of the oil produced around the world each day goes through this narrow channel.
...

So what sanctions would trigger Iran to block the Strait?

The US has asked the world to stop buying Iranian oil.

The US has lobbied China and Europe to buy their oil elsewhere. The US stopped buying Iranian oil years ago. China, Spain, Italy and Greece are still big buyers. Iran still makes up 5% of global production.

The US has put the pressure on Iran in this way to get Iran to give up its nuclear ambitions.

This reeks of hypocrisy. How can the US, which has the world’s largest store of nuclear weapons, tell other countries not to develop them? It is also inconsistent. The US let Israel develop its nuclear capacity with minimal interruption.

Iran is not happy being told what to do by a financially and morally bankrupt foreign power. And in response it threatens to close off the Strait, which would cause the oil price to soar.

The World’s Most Valuable Commodity
Oil has a long history of triggering conflicts. There is a great quote in the movie Blood Diamond that puts it well. A villager stands in front of his burning village, with dead bodies scattered everywhere, and says “…let’s hope they don’t find oil. Then we will have REAL problems.”

Because the Strait is an obvious flash point, the US has a strong military presence in the region. The US Navy has a fleet moored off the coast of Dubai. Right now, the US has positioned two aircraft carriers in the Strait, and a third is on its way. Of course, Iran has a powerful military of its own. And while Iraq had few friends, Iran has powerful allies in Russia and China. Conflict needn’t be naval either. Soldiers can launch powerful anti-ship missiles just as easily from small trucks hidden in nearby desert.

Is the US drawing the world back into war?

If you look to the calmly trading oil market for answers, it doesn’t seem likely. Oil prices have been falling, not rising.

And there are a few good reasons for this.

For one thing, the US can’t afford a conflict. Its last two conflicts have cost $1 trillion each. Obama has asked Congress to raise the US debt ceiling (again) by $1.2 trillion to $16.4 trillion. And that’s just to pay for the yawning gap between tax revenues and government expenses.

More importantly, the US knows conflict would lead to oil prices high enough to freeze economic growth in its tracks.

But Iran has rephrased its threat slightly over the weekend. Ahmad Valid, Iran’s defence minister, has back-pedaled and said Iran did not actually say “it will close the strait”.

Making sure everyone understands each other would be a good start.

The US has lobbied China and Europe to drop Iranian oil, but has not made much progress. China doesn’t seem interested. Europe has asked for six months to consider its options. Japan, South Korea and India have said they would only reduce their use. Sanctions are only partly in place.

So far it seems the US has stirred up Iran, without achieving anything.

Quite rightly, the countries that buy oil from Iran would like to know where they could get oil from instead. 5% of global supply is not easy to replace. Saudi Arabia, the world’s largest oil exporter, is confident it can bridge the shortfall. Ali Naomi, Saudi Arabia’s oil minister said, “Whatever customers want, we will give it to them.”

But it is widely believed that Saudi Arabia is already at peak production, and doesn’t have anywhere near the reserves it claims to have. So whether it can bridge the shortfall is to be seen.

Needless to say, this kind of talk has drawn Saudi Arabia into the fray. Iran has said, “Such moves are not considered friendly, and that the consequences…could not be predicted.”

The US would prefer to avoid conflict. But Iran could be unpredictable when backed into a corner. How this will pan out is impossible to say.

The Strategy Ahead
It does point to the increasing importance of sourcing energy from less volatile regions, preferably from your own doorstep. For example, the shale gas revolution in the US has given it an entirely new home-grown energy source. Shale gas projects in Australia are having some success as well.

Being self-sufficient will become more important as global tensions build over energy supplies. But it’s not just the Strait of Hormuz that we should focus on.

The South China Sea is a bit closer to home. And it could be a more important flash point. About 30% of the world’s seaborne oil is shipped through the 2 km wide Straits of Malacca (between Singapore and Sumatra), into the South China Sea.

China has been throwing its weight around much more in the last few years, claiming disputed territories and islands.

The US has recently stepped up its footprint in the area. It has promised to divert its military resources to police the region in the 21st century.

This military build-up in our backyard could have big implications for energy stocks in the future. And there will be some highly profitable investing opportunities on the back of it.

Link -
http://www.moneymorning.com.au/20120116/how-global-oil-supplies-could-fall-40-ov...
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Re: Global Economic Downturn to Continue?
Reply #748 - Jan 17th, 2012 at 5:37am
 
Imagine the price rise if oil supply is cut by 40%, it would be a good time to open a bicycle or motor bike shop.

Maybe McDonalds wouldn't be such an easy option if people had to walk too and from the golden arches.

40% less oil would certainly change the way we do business.
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Re: Global Economic Downturn to Continue?
Reply #749 - Jan 18th, 2012 at 11:01pm
 
World Bank warns of deeper crisis than the Global Financial Crisis


THE global economy is veering towards a recession potentially more debilitating than the financial crisis, the World Bank has warned.

And the Asian growth nations fuelling Australia's prosperity could be dragged into the mire, the authority says, in a move that would have severe ramifications for the domestic economy.

The World Bank yesterday slashed its forecast for global growth in 2012 and 2013.

Economists labelled the move a "wake-up call" for nations wrestling with chronic debt woes.


The Washington-based institution says that after six months of slowing economic activity, growth in the global economy is likely to clock in at 2.5 per cent in 2012 and 3.1 per cent in 2013.

Just six months ago it was forecasting 3.6 per cent growth both years.

"An escalation of the crisis would spare no-one," World Bank global macroeconomics manager Andrew Burns said.

"Developed and developing country growth rates could fall by as much or more than in 2008-09. The world could be thrown into a recession as large or even larger.

"The world has entered a very difficult phase characterised by significant downside risks and fragility."


CommSec chief economist Craig James said he was reading the report as "overly gloomy" given the solid start to the year for many nations.

"I'd say the report was written in late last year ... I think now it is looking somewhat dated.

"Maybe they are trying to create a wake-up call for countries. But this can also scare investors.

"I think the only message for Australia in this is that we live in challenging times ..."

Link -
http://www.heraldsun.com.au/business/world-bank-warns-of-deeper-crisis-than-the-...
================================
Just for Craig James at Commsec, let me say that this report is not overly gloomy!

But, it is reflecting a more likely truth than is usual for these sort of organisations, so one would have to wonder why they would be saying it?

That said, "a very difficult phase characterised by significant downside risks and fragility", is likely to turn out to be a gross understatement.
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