Wednesday, December 01, 2004

Case Study Feature: Risks in the Global Economy

The Global economy is doing very well right now but according to some analysts, serious risk factors are looming just around the corner.

"Going forward, he said, there are risks. He pointed to the rise in the cost of oil, which has not been fully priced into financial markets, and stressed the likelihood of rising interest rates and the possibility of inflation spurred by loose monetary policy in the United States and many other countries, including China. Housing markets, which have boomed in the United States and around the world, are vulnerable, with a 'real estate bubble going on practically across the entire globe,' said Neumann. 'Higher interest rates will cause problems in [that sector].'

What, if Anything, Will Sink the Global Economy? - Knowledge@Wharton


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