Global economy picking up U.S. slack

Steve Tripoli May 25, 2007
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Global economy picking up U.S. slack

Steve Tripoli May 25, 2007
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TEXT OF STORYLISA NAPOLI: Being better off financially than your parents is a thing of the past. A new study by the Pew Charitable Trusts finds American men in their 30s are doing worse than their dads. Just a decade ago, that wasn’t the case. On the other hand, the Organization for Economic Cooperation and Development says the global economy’s in its best shape in years. Marketplace’s Steve Tripoli says there are a few potential potholes in this prosperity.


STEVE TRIPOLI: The OECD says Europe, Japan and emerging economies are picking up the slack of a U.S. economic slowdown.

Simon Johnson, the International Monetary Fund’s chief economist, says this evening out of growth is giving the world a stronger economic foundation. But he says it comes with its own risks.

SIMON JOHNSON: There’s a worry I think, that there’s some complacency. People are taking this global growth a little bit too much for granted.

Johnson says the last time the world saw a growth spurt like this was in the 1960s. The difference now is that people don’t see as much political stability as they did back then, so they don’t see important factors like food and oil prices as stable either.

JOHNSON: So there’s an expectation of instability in some key economic drivers, that makes both consumers and governments more cautious than they have been in the past.

That means they’re not taking the extra cash from strong growth for granted. Which is a good thing — it could prolong the good times and lower the risk they’ll end with a bang.

I’m Steve Tripoli for Marketplace.

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