Regional Specialists Review September 2011
Overview: Economies fall - or recessions occur - typically when they're pushed. Usually the culprits are rising inflation and interest rates and a contraction in the booming, "leveraged" sectors of the economy, like housing and inventories.
Political confrontation and seemingly intractable fiscal deficits in the U.S., Europe and Japan, rising interest rates in emerging markets, and an unemployment problem the developed world over certainly make for stomach ulcers. But, although risks of contraction have increased, the usual triggers for recession appear contained in the U.S. Further, a fairly low U.S. dollar and falling commodity prices may be the needed prescription for continued, if mild, growth.