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Fed's Fischer: Global Recovery 'disappointing'

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Usual flannel and bluster from one of the donkeys at the heart of the (on-going) crisis but his misgivings about the effectiveness of macropru later in the speech are interesting.

If only the Krugmanite wreckers had a proper model of the macroeconomy - one that include money, debt and time - they might not have to keep revising their expectations down every year.

http://www.federalreserve.gov/newsevents/speech/fischer20140811a.htm

But--and this is no small "but"--the global recovery has been disappointing. With few exceptions, growth in the advanced economies has underperformed expectations of growth as economies exited from recession. Year after year we have had to explain from mid-year on why the global growth rate has been lower than predicted as little as two quarters back. Indeed, research done by my colleagues at the Federal Reserve comparing previous cases of severe recessions suggests that, even conditional on the depth and duration of the Great Recession and its association with a banking and financial crisis, the recoveries in the advanced economies have been well below average.3 In the emerging market economies, the initial recovery was more in line with historical experience, but recently the pace of growth has been disappointing in those economies as well. This slowing is broad based--with performance in Emerging Asia, importantly China, stepping down sharply from the post-crisis surge, to rates significantly below the average pace in the decade before the crisis. A similar stepdown has been seen recently for other regions including Latin America.

These disappointments in output performance have not only led to repeated downward revisions of forecasts for short-term growth, but also to a general reassessment of longer-run growth. From the perspective of the FOMC, even in the heart of the crisis, in January 2009, the central tendency of the Committee members' projections for longer-run U.S. growth was between 2-1/2and 3 percent. At our June meeting this year, these projections had fallen to between roughly 2 and 2-1/4 percent. This downward revision is not unique to our institution or to the United States.

Indeed, the IMF's expectation for long-run global growth is now a full percentage point below what it was immediately before the Global Financial Crisis.4 This reconsideration reflects lower projected growth for both the advanced and the emerging market economies.

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This slowing is broad based--with performance in Emerging Asia, importantly China, stepping down sharply from the post-crisis surge, to rates significantly below the average pace in the decade before the crisis

Good job they are measuring money based growth rather than real growth, although they would like to present one as the other, otherwise to think that parabolic 7% / 10% whatever compund growth were either likely or sustainable over longer terms might make others think they are utterly out of touch with any sort of reality.

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Not one mention of how low interest rates have reduced the income of savers by billions of dollars a year. Income that cannot be spent in the economy and instead the low rates make people save more.

Yes....save more and spend less. ;)

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Not one mention of how low interest rates have reduced the income of savers by billions of dollars a year. Income that cannot be spent in the economy and instead the low rates make people save more.

Interesting interpretation of events.

It has only negatively affected savers with short term cash deposits, anyone with duration assets (long term bonds, equity, property etc) has been living the dream! :-)

I think people are falling over themselves to invest in riskier and riskier assets with lower and lower future return potential.

This is why velocity of money is crashing because incremental money supply goes more and more into chasing asset bubbles and not spending and real investment in productive capital within the global economy. And this is why we are getting massive asset price inflation and mild price level inflation.

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Usual flannel and bluster from one of the donkeys at the heart of the (on-going) crisis but his misgivings about the effectiveness of macropru later in the speech are interesting.

If only the Krugmanite wreckers had a proper model of the macroeconomy - one that include money, debt and time - they might not have to keep revising their expectations down every year.

http://www.federalreserve.gov/newsevents/speech/fischer20140811a.htm

yeah baby!!!

emerging(export orientated from stolen western manufacturing and innovation,and deliberate western educational debasement) led economies are nosediving.

ebola just rubbed serious salt into the wounds.

"peaceful interdependent world" as rockefeller put it is looking very overdependent one-trick pony now innit?.

I guess:,

1) god has his favourites, and stealing from them makes him quite cross

2)god does hatespeech,he ain't quite as politically correct as those trying to make the uniform,unisex world....to be demonstrated shortly.

oh, and we do know that it wasn't by chance our livelihoods were decimated.

what comes next though??i guess this is where we have the choice.

once the youngsters are sufficiently p1ssed off with enforced bolshevism, will they turn neo-nazi as a backlash???..my money is on yes.

that in itself should come as a serious warning to the likes of milliband/mandelsohn/straw etc...this is brewing up bigtime.

we need to alert these people to the error of their ways,IN ORDER to prevent the backlash becoming as big as it could.(notice i say this is pretty much a done deal now, it's just the scale of it that is under discussion)

(and no this is not racist,bigoted or any other form of politically correct heresy they might choose to invent, this is fact)

I am not against jews, I am not against muslims, I am not against catholics.

I AM against those who have their own version of society and seek to force their version down everybody's necks as some kind of omnipotent priesthood, without the consent of the community at large..

in the case of the UK it is common sense, we have one of the highest population densities win the world(I think it is the largest in europe)..we have to make provision for the times of not-so-plenty......we don't have thousands of miles of sprawling prairie to feed people like the yanks have...and should there be unfortunate nasties like diseases, that is a double edged sword.

in some ways it insulates us, in others(in global trade dependent world), we will suffer if impeded.

any government worth their salt needs to make provision for both, not be stuck to some infantile idealology that everybody can move anywhere,any time and nothing belongs to them......those moving around can be barred if percieved as a threat to the new host community(ie wrt drug resistant TB and other medical nasties)..it's not exactly rocket science.

new medical protocol/legal protocol for at least US/EU(possibly russia) at some point should be:

a) application to move region consists of screening medical to ensure no nasy bugs to alternate region

B) passport "probation" of at least 5 years(preferably 10) for all conduct in new host nation..criminal conviction warranting 12mth+ sentence (with fair trial by jury),is IMMEDIATE deportation to country of origin.attempt at re-entry is capital offence.

the problem here now is the new hierarchy of "unnassailable,infallible priesthood".

it is every bit as malignant and dangerous as the spanish inquisition..and it MUST be stopped.

that means use of force if they do not listen(which they won't)

sometimes even your best friends have the unfortunate duty of telling you that you can't pull because you could use a can of deodorant/spray of mouthwash.(that's before we get started on chatting up sales pitch)

not nice to do, but true friends will take the hint....true friends will also not throw their toys out of the pram when they see you are trying to help....a bit less of this "oh I'm the special one" is in order.

Edited by oracle

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