[lbo-talk] the recent global boom

[Doug Henwood]

I was at a Council on Foreign Relations roundtable on the global  
economy this morning, featuring Ethan Harris (Lehman Bros.), Joyce  
Chang (JPMorgan Chase), and Nouriel Roubini (NYU/RGE Global Monitor),  
and chaired, as usual, by Daniel Tarullo of the Georgetown Law  
School. Chang made an interesting point. She doesn't think the world  
has "decoupled" from the U.S. The world is still one "production  
machine" (just a tad oversimplified, I'd say), but its internal  
composition has changed, with the U.S. accounting for a much smaller  
portion, and the "emerging" world (particularly China and India)  
accounting for a much larger share than in earlier business cycles.  
She also pointed out that the world has just been through the  
strongest five-year period of growth it's experienced in 150 years.

Roubini, notorious as one of the most bearish voices in the  
mainstream, said he's expecting a 4-6 quarter U.S. recession, "not  
Armageddon" - something U-shaped, with a slow recovery, rather than  
the old-style V shape (sharp downturn, sharp recovery), or the L- 
shape that Japan experienced after its bubble burst in the early 1990s.

Doug