ARLINGTON, Va. -- The crisis in the American financial system catalyzed a chain reaction of financial and political events, creating uncertainty surrounding the near-term global outlook, according to the Manufacturers Alliance/MAPI.
MAPI Chief Economist Cliff Waldman said some elements of the mid-September drama were steps toward the inevitable restructuring of a financial industry that failed to appreciate and adjust for the systemic risks posed by the securitization mania of the last 20 years or more. However, the elevation of risk aversion is threatening the economy.
"Recent data which show that the U.S. economy may have lapsed into a recession, and that growth in other key industrialized economies has either stalled or contracted, further augments anxieties over the magnitude of the global slowdown," Waldman said. "This raises the specter of a more rapid decline in global growth than had been expected and creates concerns about the near-term outlook for U.S. export demand, the principal positive element in the U.S. economic picture during the past year."
MAPI is expecting the growth of U.S. goods and services export demand to slow from 8.4 percent in 2008 to 7.3 percent in 2009.
Gross domestic product (GDP) growth in non-U.S. industrialized countries is expected to register 0.6 percent during the fourth quarter of 2008, then accelerate to 1.5 during the first quarter of 2009 and 1.7 percent during the second quarter.
Contingent on a U.S. economic recovery, MAPI expects industrialized country growth to recover to 2.1 percent during the third quarter of 2009 and 1.9 percent in the fourth quarter.
For more information on the forecast, click here.