We’re in uncharted waters — see for example this NYT report.
“It’s pretty despondent everywhere,” said Dwyfor Evans, a strategist at State Street Global Markets in Hong Kong. “O.K., there are signs that some of the leading indicators have stabilized to some extent, but it’s at a very, very low level, and we’re not seeing corporate investment picking up, or consumers starting to spend again — in other words, the traditional mechanisms by which economies come out of a recession are absent at this time.”
Hopes that the American economy, which led the world into recession, might lead it back out this year have been fading.
Last weekend, Warren E. Buffett, the chairman of Berkshire Hathaway, wrote in his company’s annual report that “the economy will be in shambles, throughout 2009, and, for that matter, probably well beyond.”
As if to emphasize the problems, the Institute for Supply Management reported that companies in Britain, France, Germany, Italy, and the United States said business was getting much worse, especially in terms of jobs.
Paul Dales, an economist with Capital Economics, pointed to the survey in forecasting that the February employment report will show a decline of 785,000 jobs when it is released on Friday. If so, it would be the largest one-month decline in employment in nearly 60 years.
Last week, the United States revised its estimate of fourth quarter gross domestic product to show a decline at an annual rate of 6.2 percent, the worst in more than a quarter century. On Monday in reporting that construction activity fell sharply in January, the government also revised the December figure lower.