51323
Gary Cohn
World Economy

World Economy Showing Little Sign of Growth

The global economy shows few signs of improving even as the US continues “to muddle through,” Goldman Sachs Group Inc President Gary Cohn said.
“I don’t see this changing,” Cohn said during a panel discussion at the Institute of International Finance meeting in Washington. “We keep saying we’re getting closer to the end, but I don’t think we’re getting closer to the end”, Bloomberg reported.
The International Monetary Fund this week kept its estimates for worldwide growth unchanged from July and said rising political tensions over globalization are threatening to derail a recovery. The global economy will expand 3.1% this year before accelerating 3.4% in 2017, while the US economy, the world’s biggest, will grow 1.6% this year, down 0.6 percentage point from July’s estimate, the IMF said.
As individual economies have become more connected and monetary policy more intertwined, central banks have lost their ability to promote growth, Cohn said.
Central banks “are an ineffective cartel now,” Cohn said. “We no longer have independent countries with independent central banks that can drive economic growth or contract economic growth within their own countries. We have a globalized world with a globalized work force and we therefore have a globalized monetary policy.”
In Europe, the economies can’t handle higher interest rates without a “retooling of the entire economy,” said Sergio Ermotti, CEO of UBS Group AG, who spoke at the panel.
Uncertainty about the outlook for growth is crimping corporate revenues and causing business leaders to avoid risk, Cohn said.
“Corporate CEOs are not wanting to take risk and are wanting to be very conservative,” Cohn said. “What’s really happening in corporate America today is we’re seeing very little top-line growth.”
The outcome in the US election is unlikely to have a long-term impact on markets if history is any guide, Mary Callahan Erdoes, CEO of JPMorgan Chase & Co’s asset-management unit, said at the panel. Markets have tended to shrug off major geopolitical events, she said.
“You don’t actually have major effects on global capital markets,” Erdoes said. They “tend to rebound within three to six months of any major shift.”

 

Short URL : https://goo.gl/oCs7lz
  1. https://goo.gl/OXJJIl
  • https://goo.gl/u40sVR
  • https://goo.gl/n36GoR
  • https://goo.gl/6MYoCj
  • https://goo.gl/ZltaV1

You can also read ...

Bank of Japan Keeps Policy Steady
The Bank of Japan kept its monetary stimulus unchanged...
Sub-Saharan Africa is still the world’s least industrialized region.
While much of Africa has achieved impressive economic growth,...
Asian central banks are not expected to mirror the Fed rate cycle as closely as in the past. The picture shows Indonesia Central Bank.
As the Federal Reserve signals an end to its decade of...
German Ministry Optimistic About Third Quarter Growth
Germany’s economy weakened at the start of the third quarter...
WTO head Roberto Azevedo renews his concerns over worrying political headwinds, especially protectionism.
The World Trade Organization on Thursday upped its forecast...
Russia Overcomes Recession
The national economy is growing and creating a base for future...
China Vexed Over S&P Credit Rating Downgrade
China is angry at Standard and Poor’s following a downgrade of...
ECB: Immigration Boosts Euroland Labor Force
Immigrants have made a large contribution to the working-age...

Add new comment

Read our comment policy before posting your viewpoints

Image CAPTCHA
Enter the characters shown in the image.

Trending

Googleplus