This is an important, MUST=READ article from highly respected, macro-economist, Gavyn Davies, writing in his FT blog. Check it out!
Why world trade growth has lost its mojo | Gavyn Davies.
For me the analysis and conclusions are worrying, Let me share some of my concerns.
Firstly, it seems that there are trends towards more protectionism. As a passionate believer in free markets and global trading, this disturbs me.
Secondly, Europe’s weakness because of Germany‘s economic policy has had a deep impact on World trade.
Thirdly, the developing World is suffering a severe slow-down in trade in 2013.
Fourthly, and most alarming is that world trade may well have been permanently damaged by the austerity policies of political leaders in Washington, London and Berlin. [the article cites the views of Nobel Prize winning economist, Paul Krugman]
Regular readers of this blog will know that I have picked up a trend to “white-wash” austerity, as if it never happened. Let’s be clear. The slow-down in World trade has severely impacted the lower and middle classes in both the developed and developing World most severely; meanwhile, the seriously wealthy have seen financial markets rebound strongly since 2008.
Personally, I still believe that there is room for enormous demand-side, fiscal policy to stimulate investment and create jobs.
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Reblogged this on Jari65 Blog.