Chapter 2 - TheGlobal Economic Environment 1 The New Normal...

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1 The Global  Economic  Environment
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The New Normal in the Global Economy The New ormal – global realignment, a Multi-speed world Slower growth (between 1-3%) in the U.S., Western Europe, and Japan (TRIAD) Accelerating migration of growth and wealth dynamics from the industrial world to the larger emerging economies – BRICs, Turkey, South Korea, Indonesia, Mexico.
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The Global Economy – The Triad Today With creeping inflation and Anemic growth in the U.S. A mild form of stagnation (stagnant growth and inflation) cannot be ruled out (in the U.S.) In Europe, there is slow and insufficient policy response to the sovereign debt crisis Germany’s growth in 2 nd Quarter of 2011 was negligible and France had no growth Japan is virtually entering another lost decade - Gross Domestic Product ( GDP ) in Japan contracted 0.30 percent in the second quarter of 2011
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Challenges to Global Economic Recovery What are the main opportunities and challenges in the Japanese economy? What are current growth rates in the Triad, BRICs, etc? Is global recovery maintaining momentum, slowing, or accelerating? What will be the effect of the European sovereign debt woes on global recovery? Will the property bubble, debt, or inflation moderate/slowdown Chinese growth? Will China allow the Yuan (Renminbi) to appreciate? Why? Is the U.S.-China relationship a ZERO-SUM GAME? What does the evidence support, global integration or decoupling?
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What is the current state of the U.S. economy? Identify one or two of the strongest drags on the economy. What is the nature and goal of the U.S. Federal Reserve’s QE policy tool? What has been the role of the U.S. consumer in global
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Chapter 2 - TheGlobal Economic Environment 1 The New Normal...

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