Worldwide Slowdown

Just finished reading an excellent article (http://knowledge.wharton.upenn.edu/india/article.cfm?articleid=4343) and it confirms the notion that world economies are suffering the same recession fate. What do you expect? The engines of growth are running away and hiding indefinitely. Yes, I mean real money. Without confidence, not many are willing to open up their wallet and invest for growth. Only the extremely wealthy can afford to accept more risk in these extremely volatile times. Hence, we hear stories about Warren Buffet brokering deals with General Electric, Goldman Sachs, etc. Regular folks like me, we just hunker down and hoard our cash. We safeguard our capital and wait for better times.

Without cash flowing into and thru the system, it is no wonder that the economy is sputtering. The US began its recession over 1 year ago, so historically we're well on our way to recovery. Our European counterparts, however, were 6 months behind and they're about to bear the brunt of their recession. This two-headed monster comprises the West, and arguably is the most important components measuring the health of our world economy. Thus, we're in a stranglehold. We're due for another rough 6+ months as financials continue to shore up their balance sheets. The economic stimulus plans put in place late last year should start to take effect. And the fiscal stimulus should also kick in soon...I hope - c'mon Congress!

Luckily, Latin America is fending off better than it has exhibited in the past. This is critical. Apart from Chindia, Latin America is the next frontier of strong growth. While Chindia is looking at slower growth, they have enough working for them to avoid any prolonged weakness. Latin America is at the center of this worldwide recession cantilever. If Brazil and her cohorts can keep it steady, I think we'll pull out of this slowdown better than expected.