.......can you envision trillions.The world leaders at the Group of Eight summit in Italy have papered over their differences on the global economic crisis by saying little and promising less, in a lot of words.
- Raphael Alexander: Is Kevin Page smarter than the IMF?
-
One day after Parliamentary Budget Officer Kevin Page predicted Canada may be set to post $159.3 billion in budget deficits over the next five years, the International Monetary Fund is touting us as the G-8 nation best-positioned to recover from the recession. Our economy is set to outperform almost every industrialized nation this year and next, with the IMF predicting a 2.3% contraction in 2009, less than most advanced economies, and a growth of 1.6% in 2010.
This has led financial analysts to suggest Canada doesn’t need the extra stimulus being advocated by Keynesian economists. Indeed, I have serious doubts we needed the stimulus earmarked already. The IMF report indicates that, globally, conditions are improving:
“Financial conditions have improved more than expected, owing mainly to public intervention, and recent data suggest that the rate of decline in economic activity is moderating,” the IMF said, adding, however, that the recovery would likely be sluggish.
The release of the IMF report coincided with the beginning of a meeting of G8 leaders in central Italy, with much of the focus expected to be on measures to put the global economy back on track. U.S. President Barack Obama and Britain’s Prime Minister, Gordon Brown, were among those advocating more fiscal stimuli be injected in the global economy, on the concern that the US$2-trillion spent worldwide may not be enough to ignite domestic demand.
For his part, Prime Minister Stephen Harper is urging restraint from G8 leaders, and said governments should ensure already-announced stimulus actually gets spent. I find it odd that countries like Great Britain and the United States are concerned that the trillions of dollars they’ve ponied up in stimulus won’t be enough, particularly when any economic indicators of success would most assuredly be delayed.
No comments:
Post a Comment