Fidelity - And The Winner Is US, UK or Spain?
Fidelity- "Five years into the worst financial crisis in generations we are starting to see how effective various policies have been. Spain, the UK and the US offer three interesting test cases, each dealing with the after effects of a real estate bust in different ways:
· Spain = austerity with tight money (austerity, no devaluation, no quantitative easing, market interest rates too high)
· UK = austerity but with loose money (austerity, currency devaluation, quantitative easing)
· US = no austerity with loose money (no austerity, stable currency, quantitative easing)
“The chart of real GDP levels below suggests that the US is following the best policy path, at least on the metric of economic performance. (...) The so-called ‘fiscal cliff’ is the first serious test of the US desire to maintain what I see as a winning policy. Most likely the political parties will see sense and spread tax rises and spending cuts over a period of years."
Trevor Greetham, Director of Asset Allocation at Fidelity Worldwide Investment
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Comment by Peter jcp on September 27, 2012 at 6:54pm -
Very Interesting case study - the guy is based in the UK and gained an MA degree in mathematics at Cambridge University; he is also a qualified actuary.
So in theory we have to believe his figures and also his conclusion and recommendations.
Sorry but I would just have to say there is something wrong with his graph ? as he is showing the US Nominal GDP level higher than at the start of the World wide recession and Banks collapses - and the growth being stronger in the recession years - than prior in the good times ?
I must be reading it wrongly or Datastream and the US have got their figures wrong ;-)
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Comment by Romano on September 28, 2012 at 8:28am -
Lol Peter I am pretty sure this is an inflation chart not GDP lol :)
Francesc, now how about comparing REAL US economic data? - have a look at shadowstats ^_`
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