We Still Haven't Fixed our Shocks!

The global economy is headed for another rough stretch, how long a stretch is not yet known.

The [IMF] foresees global growth of 3.3 percent in 2012 and 3.6 percent in 2013, down from the outlook in July, which forecast growth of 3.5 percent this year and 3.9 percent next year. The forecasts are periodic updates the fund’s World Economic Outlook report, released four times a year. 

The fund called the risks of a growth slowdown “alarmingly high,” primarily because of policy uncertainty in the United States and Europe. New estimates suggest a 15 percent chance of recession in the United States next year, 25 percent in Japan and “above” 80 percent in the euro area.

The IMF report dovetails nicely with what I wrote about yesterday.  The world is headed for another round of economic malaise and probable recession as the Third Industrial Revolution peters out.

Welcome to the new normal.