New York, NY (PRWEB) December 09, 2012
In a recent Investment Contrarians article, editor and financial editor Sasha Cekerevac notes that gross domestic product (GDP) growth for many countries has significantly declined in the third quarter of 2012; citing Brazil as a recent example, Cekerevac reports that the country’s mere 0.6% GDP growth in the third quarter didn’t come close to the expected 1.2% increase in GDP growth recorded in a survey by Bloomberg of 54 economists. (Source: “Brazil GDP Growth at Half Forecasted Pace as Investment Dives,” Bloomberg, November 30, 2012.) According to the Investment Contrarians expert, with the world economy slowing, it is possible that we could see a global recession in 2013.
“Two interesting points are apparent,” states Cekerevac, referring to his Brazil example. “First, the significant decline in Brazilian GDP growth increases the possibility of a global recession in 2013; and second, the country’s economy has some similarities with America.”
Cekerevac notes that in America, retail sales, including car sales, have remained somewhat resilient, even though the economy has been weak. He adds that the situation in Brazil is quite similar, as retail sales increased 8.5% in September from the same time in 2011, yet industrial production in Brazil fell 2.8% in the third quarter. (Source: “Brazil GDP Growth at Half Forecasted Pace as Investment Dives,” Bloomberg, November 30, 2012.)
Cekerevac concedes that, obviously, every country has its own systemic and structural issues to deal with, but he notes that big-picture GDP growth is slowing down, and there are massive issues to be resolved.
“Even though many countries have taken on huge levels of stimulus spending, as well as monetary policy easing, a global recession in 2013 cannot be ruled out,” concludes Cekerevac. “… unless real structural changes are made to the economy, the impediments restraining GDP growth will remain, regardless of the amounts of stimulus spent by governments. Giving away cheap money will only cause serious unintended consequences that will result in far more problems down the road for everyone involved.”
To see the full article, and to get a real contrarian perspective on investing and the economy, visit Investment Contrarians at http://www.investmentcontrarians.com.
Investment Contrarians is a daily financial e-letter dedicated to helping investors make money by going against the “herd mentality.”
The editors of Investment Contrarians believe the stock market and the economy have been propped up since 2009 by artificially low interest rates, never-ending government borrowing, and an unprecedented expansion of our money supply. The “official” unemployment numbers do not reflect people who have given up looking for work, and are thus skewed. They believe the “official” inflation numbers are also not reflective of today’s reality of rising prices.
After a 25- to 30-year down cycle in interest rates, the Investment Contrarians editors expect rapid inflation caused by huge government debt and money printing will eventually start us on a new cycle of rising interest rates.
Investment Contrarians provides unbiased research. They are independent analysts who love to research and comment on the economy and investing. The e-newsletter’s parent company, Lombardi Publishing Corporation, has been in business since 1986. Combined, their economists and analysts have over 100 years of investment experience.
Find out where Investment Contrarians editors see the risks and opportunities for investors in 2012 at http://www.investmentcontrarians.com.
George Leong, B. Comm., one of the lead editorial contributors at Investment Contrarians, has just released, “A Problem 23 Times Bigger Than Greece,” a breakthrough video where George details the risk of an economy set to implode that is 23 times bigger than Greece’s economy! To see the video, visit http://www.investmentcontrarians.com/press.