Friday, October 9, 2009

Nobel Prize-winning economist – Horrifying Prognosis













From left to right:
Pic 01 - 03 : Great Depression of 1930s. People lining up for food rations from USA government. We don't hope for this in Malaysia, which is only a developing nation. So shouldn't you ration your pocket money? Stretch it further?

Pic 04: Renown Economist, Paul Krugman


Nobel Prize-winning economist Paul Krugman said damage from the U.S. recession may persist “for a very long time,” with no clear engine for renewed growth.

“I’m really quite scared that we could muddle along,” Krugman said in a lecture today at the London School of Economics and Political Science. “I really do see the possibility of a global version of the Japanese ‘lost decade’ without the prospect of an export-led recovery. This could be unpleasant for a very long time.”

U.S. stocks erased a decline yesterday after Krugman said the economy will probably emerge from the recession by September. Recent reports showing smaller declines in housing and manufacturing and fewer job losses have reinforced forecasts that the slump may end this year.

“The ‘oh-my-God-the-world-is-ending’” phase of the economic downturn is over, and financial markets are “stabilizing,” Krugman said today. Still, “the employment situation is continuing to look bad and will probably get worse,” he said.
Krugman said he has “no idea” what will power the U.S. out of recession. The U.S. fiscal stimulus package, while not “trivial,” isn’t large enough to fuel sustained growth. Also, with the global economy in the doldrums, the U.S. can’t rely on a revival from a surge in exports, he said.

Even the end of a recession “doesn’t mean the same thing as it did in the old days,” said Krugman, a Princeton University economist. Unemployment may remain high longer than after the end of prior economic contractions, he said.
The National Bureau of Economic Research, based in Cambridge, Massachusetts, is the official arbiter of U.S. recessions and expansions. Robert Hall, the head of the NBER’s business-cycle-dating committee, said last week that it’s “way too early” to say the contraction is over.

What can and is Malaysian Government doing about it?
What is in store for upcoming ACCA graduates?

Coming soon...

1 comment:

Marcus Ong said...

I can't help it but agree the recession due to Finance Meltdown in USA will take a long long time to recover.

According to Harvard Professor, Chris Bartlett et al, this is going to be exciting era of innovation that spawns new industries. great opportunities lie just ahead like:

- electric cars
- green energies
- green building technologies
- hand held banking
- hand held phone entertainments
- 3 D entertainment

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