The Slow-Growth World
The U.S. is doing comparatively well as Europe struggles and the emerging economies slow.
This week I had the chance to hear Bill Strauss of the Federal Reserve Bank of Chicago speak, and he offered up some good news and some bad news. The good news was that the United States could likely be the strongest economy in the world right now. That was also the bad news. Even with the country's anemic growth rate and high unemployment levels, it is still in much better shape than Europe and in many ways is in a less precarious position than many emerging markets. This is hardly a minority view.
In October, the International Monetary Fund released its World Economic Outlook and the take was hardly rosy. The organization expects the world's gross domestic product to grow by only 3.3% this year and 3.6% in 2013. This is down from 5.1% in 2010 and 3.8% in 2011. Worse yet, these estimates assume that there is no escalation in the eurozone crisis and that the U.S. manages to avoid the brunt of the fiscal cliff. Given the problems facing the global economy, we may have to get used to this slow growth for some time.