David Kirkpatrick

October 30, 2008

The economic malaise is truly international

Filed under: Business — Tags: , , , , — David Kirkpatrick @ 3:47 pm

We do live in a world economy. Banks are closely tied together across borders and oceans, and even relatively potent economies are hurting because it’s pretty hard to export when there’s no buyers.

From the link:

The U.S. economy shrank in the third quarter as the financial crisis raged while Japan and Germany said on Thursday they would spend billions of dollars to provide a cushion against a deep global recession.

The spending measures would complement a series of interest rates cuts, including those from China, Norway and the United States on Wednesday.

 

Japan may cut rates on Friday and the European Central Bank, Britain and Australia are expected to follow next week, which would come just as data showed a rapid deterioration in major economies.

 

“A harsh storm seen only once in 100 years is raging,” Japanese Prime Minister Taro Aso told a news conference.

 

The world’s largest economy shrank at a 0.3 percent annual rate in the third quarter, the sharpest contraction in the United States in seven years.

 

The specter of recession had unnerved U.S. consumers, who slashed spending at the sharpest rate in 28 years in the third quarter, undermining growth.

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