The US Double Dip: It could well be a reality

Initially the experts predicted a V shaped recovery i.e. a fast recovery for the US but then shifted to the left in the alphabetical order i.e. U, a slower path to recovery, but the existing scenario might push them further to the right i.e. to W or double dip. A look at the common economic indicators like unemployment rate, growth rate, rate of inflation or interest rate etc. would tell us that the future is murky. Add to that the increasing clout of countries like China or should we say decreasing impact of US on the global setup is only worsening the cause. The inability of the US to force appreciation of Yuan is a case in point. The usual backers of US like UK, France, Japan are themselves deep into crisis so no help can be expected from that quarter. The world economy discussing “decoupling” shows that the perception is that the US is lonely as well as depleted in its battle with recession.

The Decoupling Theory

One term that has been doing the round nowadays on the web, on biz news channels or newspapers is “Decoupling”. The decoupling theory holds that Emerging economies have broadened and deepened to the point that they no longer depend on the United States or Europe for growth. Emerging markets (EMs) are nations with social or business activity in the process of rapid growth and industrialization. So let’s start our exploration of the decoupling theory (DT) now.

Decoupling as we all know is separating or detaching. But what’s the reason that we hear so much about DT? The two likely reasons are shaky recovery of the developed economies with V shaped likely to make way for a U or even worse W shaped recovery and the robust performances of the emerging economies like China & India.  So what does DT entail for the world economy? One, it signifies the growing strength of the developing countries as well as weaning strength of the countries like US & UK. Add to that it also tells that emerging countries are gaining self sufficiency i.e. consuming what they are producing within themselves.

The Past, The Present & The Future of Asia.

We all love keenly contested battles. Isn’t it? Such contests can take place on the sports ground, in the academic setup, on the battlefield etc. The one such battle that I am going to talk about, is taking place on the global scale. It’s the battle to become the next economic superpower of Asia. In this blog I’ll discuss the three countries that look set to stake their claim for the Numero Uno tag. The great thing about this contest is that we could have three different leaders at three commonly classified points of time i.e. the Past, the Present & the future. So, let me break the suspense on the trinity (if there was ever one). They are Japan, China & India. Let’s us analyze their strengths, weaknesses and the possible road ahead.