economic outlook

Ralph Atkins

Might the global economy all go horribly wrong again?

Lorenzo Bini Smaghi, an ECB executive board member, has just warned that those who think the world will return to where it was before the economic crisis are “deluding themselves”.

Addressing a crowded Frankfurt reception hosted by the city’s chambers of commerce, he said: “If the world economy were to return to the pre-crisis situation, within a short timespan a new crisis would be likely to occur because the same imbalances that led to the crisis would build up again.”

In what I thought was a pessimistic comment – even by ECB standards – he went on: “Considering some recent developments and behaviour, and considering the way certain policies are being discussed and the thinking of some key players, such a scenario does not seem that unlikely.” Read more >>