MAY 10, 2018
“Global synchronous recovery.” It’s such a pretty phrase. It sounds great and the mainstream media loves to talk about it, this idea of the world’s major economies all walking in lockstep into a shared and more robust fiscal future.
But what we actually have is a global synchronous slowdown, which is amazing given the extraordinary lengths central banks have gone to trying to engineer recoveries. What happens when the effects of rising interest rates and shrinking central bank balance sheets choke off what little growth there is?
Finally, and most ominously, this chart of quarterly GDP growth shows the three largest developed market economies.
We see in all three places that quarterly growth peaked in mid-2017 and then fell in the last quarter. Yet the experts tell us a synchronized global recovery is forming. Really?
What I see here is a synchronized downturn. Granted, it’s just a couple of quarters but early data makes Q1 2018 look lower still.
If a recession is coming, GDP growth will decline from its present level to 0% or below. That process will likely unfold over a few quarters—and may already be beginning.
ORIGINAL SOURCE: The Global Economy Is Not Recovering—Just Look at the Data by John Mauldin at Mauldin Economics on 5/3/18