I was visiting the ISM New York website when I noticed the Wells Fargo economic review for July as a download item.
I have to admit I thought a number of the arguments, especially the most important ones of the moment, were a bit loose:’
European leaders are caught between the rock of radically restructuring their economic and political systems and the hard place of potential financial crisis and a very painful recession. In our view, the most likely scenario is one of “muddle through.” We believe that each time the crisis rears its ugly head European leaders will do enough in terms of a policy response to make the crisis die down temporarily. As the record of the past two years shows, however, they likely will not completely “fix it” and tensions in financial markets will ultimately resurface. In this base-case scenario, therefore, the European sovereign debt crisis will continue to wax and wane for the foreseeable future.
As we continually witness for Europe, but also in our daily mirror, the challenge for decision makers in both the private and public sectors is that growth, while positive, does not satisfy and does not provide an easy out from the debt/fiscal challenges of this decade.
Apparently we will all muddle through while solving nothing: I do not see how we can continue to muddle through and solve nothing for much longer, especially as economic conditions are all the while worsening . Muddling through makes me think that the economists either have no idea what is happening, or it is not in their career interests to make a call either way.