Chemical Processing - January 2008 - (Page 23) PO;; Swift agreed that job growth is the only positive ACC’s development at the moment. But he also warns: “If we get three months of job growth of less than 75,000 per month, we will be looking at recession. This jobs growth is holding up the U.S. economy. If it decelerates — well, exports are doing good, but they won’t make up for a softening of consumer sentiment ,” he concluded. Former U.S. treasury secretary Lawrence Summers offered a bleak outlook in a late November article in the Financial Times, the prestigious U.K. business newspaper. “The odds now favor a U.S. recession that slows growth signi cantly on a global basis.” He cited a number of factors for this, including indications that the housing sector may be in free-fall in terms of both construction and prices. In the developing world, China is really leading the charge – its consumption of chemicals is booming. Just one day earlier, BP Chairman Peter Sutherland struck a similar note. Speaking on Irish television channel TV3, he said that the current global nancial crisis could cause considerable trauma throughout the whole of 2008 because of a lack of understanding about its causes. Sutherland, who also is chairman of Goldman Sachs International and a former E.U. competition commissioner, echoed the fears of the People’s Bank of China when he said: “The problem is everyone says that we can rely on growth in China and India, but China exports most of its products to the United States so if the U.S. is in a recession, this is a problem.” Because the background of the crisis is neither fully understood nor fully played out in regard to providing credit and liquidity to institutions, he described the situation as very complicated — and one that isn’t helped by the U.S. economy being in a mess. Sutherland described as “terribly depressing” an IMF meeting earlier in November and other meetings since of central bank governors. “People didn’t understand the extent of the problem. So I think it’s a dangerous period for the world,” he concluded. ACC’s Kevin Swift describes Sutherland’s remarks as “fair comment,” noting that just about half of the economic gurus he monitors now are talking about a possible recession. He also agrees with Summers’ sentiments: “There’s a lot of talk about decoupling and there is no doubt that the relationship between U.S. growth and East Asian growth has changed. However, if the U.S. snif es, there is still no doubt that the rest of the world gets a cold.” CP www.chemicalprocessing.com http://www.sulzerchemtech.com ctus.tas@sulzer.com http://www.sulzerchemtech.com http://www.chemicalprocessing.com
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