By now, you've probably heard of the much-ballyhooed "green shoots" in the economy. On Friday, the Dow actually closed positive for 2009, leading some commentators to begin championing an increasingly optimistic rhetoric. In fact, in a recent survey of 53 economists by the Wall Street Journal, the consensus was that the recession would end in September.
But, among all the talk of increasing optimism in the financial markets, however, there are a few holdouts.
This week, writing in the Financial Times, Wolfgang Münchau : "..at this point, I see the chances as roughly even between a global slump and a return to quasi-stagnation."
He's certainly not alone. Here are three world-beating economists who've recently offered up some strong resistance to the growing cult of optimism:
1. Nouriel Roubini -- We all know by now that the economist they called Dr. Doom isn't one for market cheer leading. But he's been recently striking back against market optimists. Roubini's predicting U.S. GDP growth of just 1 percent in next year, and believes that much of the world economy will remain flat.
"Recovery will be weak, anemic, subpar," he said. Optimists are "getting ahead of the curve" and "advanced economies are going to grow at a very slow rate" after the recession is over, he added.
2. Paul Krugman -- Though the Nobel Laureate Krugman was widely quoted as saying the U.S. recession could subside by September, his predictions weren't entirely rosy.
"I really do see the possibility of a global version of the Japanese 'lost decade' without the prospect of an export-led recovery. This could be unpleasant for a very long time."
Krugman also worried that he wasn't sure what economic forces would lead the U.S. out of a recession, and said that unemployment could stay high, even during a recovery. Earlier in the year, Krugman indicated that a "depressed" U.S. economy could last for five years.
3. Paul Samuelson -- The eminent, Nobel-winning economist recently responded with skepticism to Federal Reserve Chairman Ben Bernanke's statement that the economy could recover by the end of the year. One reason for gloom, Samuelson wrote, is China, whose over-investment in the U.S. economy, which ""means lethal troubles for the future U.S. economy." Samuelson fears that China's increasingly large stake in the U.S. dollar could have some perilous effects. Samuelson writes:
"When a disorderly run against the dollar occurs, I believe a truly global financial panic is to be feared. China, Japan and Korea now hold dollars not because they think dollars will stay safe. Why then? They do this primarily because that is a way that can prolong their export-led growth."
4. Honorable Mention: He isn't an economist, but he makes a great point. In this video, the author of Liar's Poker, Michael Lewis, hands out a dose of reality while speaking with Fareed Zakaria on CNN. His basic argument is that Wall Street made this mess, and is now earning a fortune cleaning it up.
(It should probably be noted that investors certainly weren't optimistic today -- the Dow was down more than 200 points today.)
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