Finance ministers and central bank governors gathered in Washington
for the annual IMF/World Bank meetings last month at a time when
the global economy showed little sign of sustained recovery.
The outlook is uncertain. If the property bubble bursts in the US
- a second blow after the equity meltdown - consumers there, who
have driven the weak recovery so far, will stop spending. Neither
trade nor investment will take up the slack.
The fear of double-dip recession and deflation is growing. Equity
markets continue to fall as corporations deliver weak profits and
struggle with huge debts.
Institutional investors show little inclination to finance
emerging markets. Brazil is on the brink. Markets are almost
driving it towards default that might destroy emerging markets as
an asset class.
Meanwhile war looks ever...
