In the latest Viewpoint, Jeremy Gardiner from Investec discusses the state of the world economy. The article is available on our website (click here). For your convenience, we have summarised it below:
State of the world economy
- The world is now four years into what is proving to be the slowest recovery since the 1930s.
- The world is stuck with anaemic growth, low interest rates and QE3.
- The US economy is showing signs of recovery – housing prices are increasing and unemployment is decreasing.
- The next hurdle for the US economy is the ‘fiscal cliff’ starting next year, as a result of govt spending cuts and tax increases.
- If implemented, this will put the US (and possibly global economy) back into recession.
- The Eurozone remains in recession, flat growth is expected next year.
- China is not disappointing: fears that Chinese growth could collapse have proven unfounded.
- South Africa: perspective is imperative. South Africans are too pessimistic. On the positive side:
- We don’t have a housing crisis.
- Our banks are strong.
- The South African equity market has been strong over the past 12 years.
- We are not bankrupt and do not have debt problems.
- SA needs leadership. Put the right people in the right jobs and SA will start heading in the right direction reasonably quickly.
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