{"id":42666,"date":"2019-01-12T14:56:31","date_gmt":"2019-01-12T19:56:31","guid":{"rendered":"https:\/\/olduvai.ca\/?p=42666"},"modified":"2019-01-12T14:56:31","modified_gmt":"2019-01-12T19:56:31","slug":"risks-to-the-global-economy-in-2019","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=42666","title":{"rendered":"Risks to the Global Economy in 2019"},"content":{"rendered":"
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\"crystal<\/picture>Adam Gault\/Getty Image<\/span><\/figure>\n

Risks to the Global Economy in 2019<\/a><\/h3>\n<\/div>\n
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Over the course of this year and next, the biggest economic risks will emerge in those areas where investors think recent patterns are unlikely to change. They will include a growth recession in China, a rise in global long-term real interest rates, and a crescendo of populist economic policies.<\/p>\n<\/div>\n

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CAMBRIDGE \u2013 As Mark Twain never said<\/a>, \u201cIt ain\u2019t what you don\u2019t know that gets you into trouble. It\u2019s what you think you know for sure that just ain\u2019t so.\u201d Over the course of this year and next, the biggest economic risks will emerge in those areas where investors think recent patterns are unlikely to change. They will include a growth recession in China, a rise in global long-term real interest rates, and a crescendo of populist economic policies that undermine the credibility of central bank independence, resulting in higher interest rates on \u201csafe\u201d advanced-country government bonds.1<\/a><\/span><\/p>\n

A significant Chinese slowdown may already be unfolding. US President Donald Trump\u2019s trade war has shaken confidence, but this is only a downward shove to an economy that was already slowing as it makes the transition from export- and investment-led growth to more sustainable domestic consumption-led growth. How much the Chinese economy will slow is an open question; but, given the inherent contradiction between an ever-more centralized Party-led political system and the need for a more decentralized consumer-led economic system, long-term growth could fall quite dramatically.1<\/span><\/a><\/p>\n

Unfortunately, the option of avoiding the transition to consumer-led growth and continuing to promote exports and real-estate investment is not very attractive, either. China is already a dominant global exporter, and there is neither market space nor political tolerance to allow it to maintain its previous pace of export expansion. Bolstering growth through investment, particularly in residential real estate (which accounts for the lion\u2019s share<\/a> of Chinese construction output) \u2013 is also ever more challenging.1<\/span><\/a><\/p>\n

\u00a0\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Adam Gault\/Getty Image Risks to the Global Economy in 2019 Over the course of this year and next, the biggest economic risks will emerge in those areas where investors think recent patterns are unlikely to change. They will include a growth recession in China, a rise in global long-term real interest rates, and a crescendo […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[21635,130,7844,366,1508,8402,1264,690,3222,827],"class_list":["post-42666","post","type-post","status-publish","format-standard","hentry","category-economics","tag-21635","tag-china","tag-donald-trump","tag-global-economy","tag-kenneth-rogoff","tag-project-syndicate","tag-recession","tag-risk","tag-trade-war","tag-united-states"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/42666","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=42666"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/42666\/revisions"}],"predecessor-version":[{"id":42667,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/42666\/revisions\/42667"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=42666"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=42666"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=42666"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}