The world economy - Test of stamina / ECONOMIST

i think the chances for the worldwide economy to resist a us recession have never been better. but i have the fear that the next us recession good be a big one......

glaube ebenfalls das die chancen der weltwirtschaft eine us rezession einigermaßen zu überstehen noch nie so gut waren. allerdings befürchte ich das die nächste us rezession ne happige wird.....

What, asks the IMF, might a flagging America mean for the rest of the world?

ALTHOUGH the pacemaker is tiring, the other runners are keeping up a good speed. This week the IMF marked down its forecast of American GDP growth, but detected no loss of puff in the rest of the world. In its semi-annual World Economic Outlook, ahead of this weekend's meetings of the fund and the World Bank, the IMF forecasts that world output will grow by 4.9% both this year and next, just as it did last autumn. But it has cut its forecast of American growth in 2007 by 0.7 percentage points, to 2.2%, and in 2008 by 0.4 points, to 2.8%. It has raised its estimates for the euro area and for developing countries in Asia and elsewhere.

This is consistent with the idea that Asia and Europe have become “decoupled” from America, despite the growth of international trade and financial integration. Some (including this newspaper) have seen signs that Asian and European domestic demand will be strong enough to withstand an American slowdown. Others are not so sure: recently the Asian Development Bank said it could find “no evidence” that fast-growing East Asian economies were detaching themselves from America, Europe and Japan.

One chapter in the Outlook, from which economists on both sides have claimed support, weighs up the evidence. The fund notes that America's recent slowdown has so far had little effect beyond Canada and Mexico—but also that it has been largely confined to housing and manufacturing. The risk that it will spill over to consumption and thence, via imports, to other countries, has not passed. Macroeconomic policymakers may have to be prepared to offset any damage.

The fund looks back at the effects of five American recessions and two milder “mid-cycle slowdowns” in the past 30-odd years. On average, growth in other regions fell during the recessions by about half as much as in America. The fall varied across both recessions and regions (see chart). Synchronised declines have tended not to be the result of spillovers from America, but to have global causes. In 2001, for example, many regions were caught by the bursting of the tech bubble, tumbling stockmarkets and declining investment. In 1974-75, the first oil-price shock was a common factor.

America's 1991 recession, in contrast, was a more local affair, after the savings-and-loan crisis. Regional differences also matter. In 1982, for example, Asia and Latin America were hurt more than industrial countries. Latin America suffered especially as rich-world interest rates rose, bringing on the region's debt crisis.

The mid-cycle slowdowns, in 1986 and 1995, were much tamer. American GDP growth fell by only a percentage point on average; the median decline in other industrial countries was only a tenth of that; and growth in other regions rose. So far, notes the IMF, today's American slowdown fits this pattern.

Mild, with local causes: in other words, so far the American slowing is of just the type to leave Asia and Europe undisturbed. Stephen Roach of Morgan Stanley argues that it is premature to say that decoupling has been truly tested. He's right: it hasn't. Over to the American consumer.