UN paints bleak picture of stagnating world economy

.local10.com ^ | Edith M. Lederer

[BenLurkin]

The report blames a host of factors for this year's lackluster economic prospects including persistent weak demand in the major economies which remains a drag on global growth, the low price of oil and other commodities which are hurting exporting countries, severe weather-related shocks especially severe drought related to El Nino, political challenges, and large capital outflows in many developing regions.

Dawn Holland, a senior economist in the U.N. Department of Economic and Social Affairs, said the 2.4 percent growth predicted for this year is 1 percent lower than the average annual rate of growth of 3.4 percent in the decade leading up to the global financial crisis in 2008 and 2009. It reflects the weak global economy for most of the last decade, she said.

For 2017, Monteil said, "the global economy is projected to expand by 2.8 percent, marking a very modest improvement — and possibly reflecting the downturn bottoming out in some emerging economies."

But he stressed that for the world economy to grow it needs increased investment and greater fiscal stimulus coordinated by the major economies who have relied for too long only on monetary stimulus like interest rates.

[Sam Gamgee]

Not surprising at all. So how can you have a stock market hitting new highs while we are part way into a global recession?