Global stagnation
Global stagnation is generally considered in late 2011 to be a possible short-term prospect, involving a large part of the world economy. Of 30 countries surveyed by the International Monetary Fund, the growth rates of the economies of 20 were classified as "below trend and moderating", 8 as "below trend and rising", and 2 as "above trend"[1]. The general slowdown of economic growth that occurred in 2011, following the strong growth of 2010, is thought to be attributable to a range of factors, including:
(a) the completion of the stockbuilding phase of the inventory cycle that normally follows a recession;
(b) the economic shock caused by the Japanese tsunami of March 2011;
(c) continuing deleveraging by banks and the consequently continuing credit crunch affecting small companiies;
(d) the effect on demand of continuing deleveraging by companies and households;
(e) the effect on demand of the reductions in public expenditure and the other fiscal adjustments in the fiscal aftermath of the Great Recession;
(f)