Crisis depends on the appetite of Americans

Until recently, economists were convinced that the U.S. economy will come first in a crisis as recovery goes faster than in Europe. But the results from the second quarter of 2009 showed more weakening of the recession in Germany and France, and positive trends in Asia. These signs of recovery in the world were welcomed with relief, but the IMF chief economist Olivier Blanchard warned that ultimately everything depends on developments in the United States.

Land consumption increases economic stress. Everything comes down to the appetite of Americans. Consumption represents 70 percent of total demand in the United States. Its reduction was the main reason for the reduction of production in this crisis. Like Blanchard, most leading economists believe that the user will stress after the crisis is so large that not only the U.S. but in Europe as consumers will hardly return to pre-crisis levels of consumption. The reason for skepticism is the weakness of the financial system that remains fragmented by the crisis.

Michael Mussa, former IMF chief economist and assistant in one of the most prestigious economic institutions Peterson in Washington – also emphasizes that recovery will depend largely on exports, but he does will be determined by the U.S. market’s appetite for foreign goods . But dependence on the U.S. market is not the same for all exporting countries, highlights the economist of the U.S. import growth began to slow more noticeably in 2006. Late last year he fell and quite clearly has influenced policy states. Germany, for example, is particularly dependent on exports. Largely recession in Germany is due precisely to reduce exports. So that its recovery will be particularly dependent on outside demand and export opportunities.

Recovery in Bulgaria depends on developments outside

Economists point out that Eastern Europe is also highly dependent on exports. Countries such as Bulgaria, according to many estimates, will have delayed recovery, which would go hand in hand with the recovery of demand in foreign markets.

Dependencies prolichavat most in times of crisis

Analysts remain extremely cautious in its forecast for the near economic future. Michael Mussa said that we must be cautious. In Europe and the U.S. will probably see how the figures will become more positive in the third and fourth quarters of this year and next year. But as great are the hopes of economists that the biggest disruption will be followed by a major economic explosion, no one undertakes to predict how fast the recovery will be. Michael Mussa, said that he personally still convinced that we will refund which will be much stronger than what most economic analysts expected.

But the data so far neither supported nor rejected this argument.

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Deutsche Welle

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