A Year on the Brink
The two main surprises in 2012 were the slowdown in emerging markets, which was slightly sharper and more widespread than anticipated, and Europe’s embrace of some truly remarkable reforms – though still far short of what is needed. Looking to 2013, the biggest global economic risks are there and in the US.
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NEW YORK – The year 2012 turned out to be as bad as I thought. The recession in Europe was the predictable (and predicted) consequence of its austerity policies and a euro framework that was doomed to fail. America’s anemic recovery – with growth barely sufficient to create jobs for new entrants into the labor force – was the predictable (and predicted) consequence of political gridlock, which prevented the enactment of President Barack Obama’s jobs bill and sent the economy toward a “fiscal cliff.”