Global Economic Downturn

Some experts say the dollar will continue to get stronger, others say it will once again begin to weaken. In the past few weeks the dollar has gotten stronger and that translates into higher prices for American products in overseas markets. Its not clear that this trend will continue.

The problem is the world economy is also slowing and so the demand for American goods with a stronger dollar declines especially when coupled with each country's inflation and recession like growth.

This is not universally experienced by all countries and all companies, some are doing just great.

The article suggests that the global economic downturn will help to bring down the cost of food and oil worldwide. Many key financial managers are hoping that this adjustment occurs and are actively planning for it. This is the main reason why the interest rate in the US is unchanged at present.

A calamity or two, or a war or two especially one where an oil producing country is involved could blow the present shaky house of cards all over the landscape.

NYT: U.S. and Global Economies Slipping in Unison

Now, high energy prices, financial systems crippled by fear, and the decline of trading partners have combined to choke growth in many major economies.

As the United States and many other large economies slip in unison, the reality of integrated markets is being underscored

Japan...saw its economy contract at a 2.4 percent annual rate from April through June after accounting for inflation. Germany, another export power, slid at a 2 percent clip...

NYT: Inflation Delivers a Blow to Vietnam’s Spirits

With inflation rising to 27 percent last month — the highest in Asia — and food prices 74 percent above those a year ago, Vietnam is suffering its first serious downturn since it moved from a command economy to an open market nearly two decades ago.