Drop, drop, drop and then a turn up--on global trade

WORLD NEWS: "World Trade Volume Climbs 2.5%: June Data Indicate Bottoming Out, a Key Condition for Recession to End," by Paul Hannon and John W. Miller, Wall Street Journal, 27 August 2009.

Trade will still be down globally for the year, but that incredible drop of 9-10% (the IMF says more than 10%) is looking less permanent and thus less scary--except for countries like Germany or Japan that live on exports.

Some experts say "back to school" explains it, but smart money says "the pickup in trade flows likely reflects the end of drawing down inventories, and the reconnection of global supply chains."

So much for the great era of de-globalization, as China alone seems responsible for Latin America's uplift.

I love the ending here:

Many economists say world trade has considerable lost ground to cover.

Ooooh! That sounds ominous.

So how long, then?

Late 2011 at the earliest.

Really? We're talking the biggest global slowdown since the Great Depression and you want me to have to wait two long years before we make up all the ground lost over the past 18 months? I thought it was Mad Max-land for the next several decades! What am I gonna do with all that ammo in the basement?

Comments

[Javaid Akhtar]

I wonder if there is a average number of years that end-of-worlders tend towards.Can't be too close ..but not so far as to dis-engage your followers.4-5 years ?.

[Tom Barnett]

By my experience, the hot zone is more like 2-3 years. Check Y2K as a prime example.

But it's a very interesting question. We had a millennarian specialist work with us on the Y2K stuff and System Perturbations. Belief systems are always attracted to such disruptions, like a moth to a flame.

[Mark Fragale]

Tom,

I remember Y2K...I was fighting with some coked up moron, rolling in dog droppings and being bit by same moron (he tried to chew my thumb off). The world did not end.It was tough to get my boss to take the possibility of someone or some group taking advantage of the end of days millennial timing to start something and at least be prepared to deal with it.

I have noticed many confuse adequate preparation with "end of the world doom". Was guilty in my earlier years of doom doom doom dah dah doom. Most grow out of it. Been through to many interruptions of service to not be ready to get by for a week or two w/o basic services.

The extra ammo will still go bang for a long time and I can always use the practice and stress relief.

[Louis Heberlein]

2-3 years. Isn't that the cycle when Mars get closest to Earth? Oh Dear!