SHIFT HAPPENSWorld Economic Outlook 2012<br />Ángel Cabrera<br />Thunderbird School of Global Management<br />@CabreraAnge...
IMF September Forecast for 2012<br />Advanced economies<br />+1.9% (-0.7% from June)<br />Emerging economies<br />+6.1% (-...
IMF September Forecast for 2012<br />United States<br />+1.8% (-0.9% from June)<br />Euro Area<br />+1.1% (-0.6% from June...
Emerging Markets GDP Growth<br />Average Real GDP per Capita<br />Composition of World Real GDP<br />W. Europe<br />Asia D...
Rise of Emerging Markets Trade Flows<br />Exports/Imports <br />EM Trade as a % of Total World Trade<br />Emerging Markets...
(1) Calculated using purchase power parity exchange rates. Source: Citi Investment Research & Analysis report “Global Grow...
G7 vs. E7<br />U.S., Japan, Germany, U.K., France, Italy and Canada<br />China, India, Brazil, Russia, Mexico, Indonesia a...
G7 vs E7<br />Source: PWC.com<br />
What world do you prefer<br />Option A: We grow at 2% while others grow at 1%<br />Option B: We grow at 3% while others gr...
Should we worry?<br />
Emerging Markets Driving Global GDP Growth<br />200%<br />Japan <br />Developed<br />Emerging<br />Italy<br />France<br />...
Europanic<br />Interbank markets sign trouble<br />A run on Italian and Spanish debt can make Lehman Brothers seem trivial...
Europanic<br />
Summary<br />Explosive mix:<br />Slow recovery, even recession in developed economies<br />Increased fiscal and financial ...
Areas of attention<br />Fiscal consolidation <br />Not too fast or it will kill <br />Not too slow or it will feed uncerta...
Global Business Dialogue - Nov 10-11<br />Thunderbird School of Global Management<br />@Thunderbird<br />
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Economic Outlook 2012: Shift Happens

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Great informative presentation made by Dr. Angel Cabrera at the Economic Outlook 2012 event in Phoenix.

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  • China’s aging population and one child policy will cause it to grow at a decreasing rate starting in 2020when compared with India whose work force is relatively young and growing! These two powerhouses will be the major contributor of the E7 growth projections
  • Gov’t has slowed stimulus, but private demand hasn’t picked up demand - Families still deleveraging, soft housing markets, tight lending
  • Economic Outlook 2012: Shift Happens

    1. 1. SHIFT HAPPENSWorld Economic Outlook 2012<br />Ángel Cabrera<br />Thunderbird School of Global Management<br />@CabreraAngel<br />
    2. 2. IMF September Forecast for 2012<br />Advanced economies<br />+1.9% (-0.7% from June)<br />Emerging economies<br />+6.1% (-0.3% from June)<br />World<br />+4.0% (-0.5% from June)<br />
    3. 3. IMF September Forecast for 2012<br />United States<br />+1.8% (-0.9% from June)<br />Euro Area<br />+1.1% (-0.6% from June)<br />Japan<br />+2.3% (-0.6% from June)<br />
    4. 4. Emerging Markets GDP Growth<br />Average Real GDP per Capita<br />Composition of World Real GDP<br />W. Europe<br />Asia Dev.<br />Asia Emerging<br />CEEMEA<br />N.A.<br />Latin America<br />2010-2030E CAGR<br />$39T<br />$73T<br />$180T<br />EM:<br />42%<br />EM:<br />52%<br />World 3.6%<br />EM:<br />70%<br />Source: Citi Investment Research & Analysis report “Global Growth Generators,” February 2011.<br />Note: Asia Developed is comprised of Japan, Australia and New Zealand. <br />
    5. 5. Rise of Emerging Markets Trade Flows<br />Exports/Imports <br />EM Trade as a % of Total World Trade<br />Emerging Markets<br />Developed Markets<br />2009<br />2009<br />Source: UN Conference on Trade and Development (UNCTAD) Handbook of Statistics 2010. <br />
    6. 6. (1) Calculated using purchase power parity exchange rates. Source: Citi Investment Research & Analysis report “Global Growth Generators,” February 2011 and Pricewaterhouse Coopers, “UK Economic Outlook,” November 2009.<br />
    7. 7. G7 vs. E7<br />U.S., Japan, Germany, U.K., France, Italy and Canada<br />China, India, Brazil, Russia, Mexico, Indonesia and Turkey<br />
    8. 8. G7 vs E7<br />Source: PWC.com<br />
    9. 9.
    10. 10.
    11. 11.
    12. 12. What world do you prefer<br />Option A: We grow at 2% while others grow at 1%<br />Option B: We grow at 3% while others grow at 6%<br />
    13. 13.
    14. 14.
    15. 15. Should we worry?<br />
    16. 16.
    17. 17.
    18. 18.
    19. 19.
    20. 20.
    21. 21. Emerging Markets Driving Global GDP Growth<br />200%<br />Japan <br />Developed<br />Emerging<br />Italy<br />France<br />Canada<br />UnitedKingdom<br />Germany<br />UnitedStates<br />Netherlands<br />Public Debt 2010 (%GDP)<br />Spain<br />Brazil<br />Argentina<br />India<br />Turkey<br />Mexico<br />South Africa<br />Indonesia<br />Korea<br />Australia<br />China<br />Saudi Arabia<br />Russia<br />Average GDP Growth 2010-2014 (%)<br />Source: Citi, Economist Intelligence Unit.<br />
    22. 22.
    23. 23. Europanic<br />Interbank markets sign trouble<br />A run on Italian and Spanish debt can make Lehman Brothers seem trivial<br />
    24. 24. Europanic<br />
    25. 25. Summary<br />Explosive mix:<br />Slow recovery, even recession in developed economies<br />Increased fiscal and financial uncertainty<br />Rebalancing necessary<br />Internal: from public to private demand. <br />External: from advanced economy to developing economy demand<br />Worries about sovereign bonds, translated into worries about banks holding that debt<br />
    26. 26. Areas of attention<br />Fiscal consolidation <br />Not too fast or it will kill <br />Not too slow or it will feed uncertainty<br />Just right!<br />Manage looming crisis<br />Support weak links that can trigger domino effect: european sovereign debt, banks, ease housing troubles<br />Rebalance global trade<br />Learn new acronyms<br />E7<br />E2E<br />
    27. 27. Global Business Dialogue - Nov 10-11<br />Thunderbird School of Global Management<br />@Thunderbird<br />

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