Will Complacency Be Tested in 2018?

❝ After years of post-crisis despair, the broad consensus of forecasters is now quite upbeat about prospects for the global economy in 2018. World GDP growth is viewed as increasingly strong, synchronous, and inflation-free. Exuberant financial markets could hardly ask for more…

❝ As was evident in both 2000 and 2008, it doesn’t take much for overvalued asset markets to fall sharply. That’s where [a] third mega-trend could come into play – a wrenching adjustment in the global saving mix. In this case, it’s all about China and the US – the polar extremes of the world’s saving distribution.

China is now in a mode of saving absorption; its domestic saving rate has declined from a peak of 52% in 2010 to 46% in 2016, and appears headed to 42%, or lower, over the next five years. Chinese surplus saving is increasingly being directed inward to support emerging middle-class consumers – making less available to fund needy deficit savers elsewhere in the world.

❝ By contrast, the US, the world’s neediest deficit country, with a domestic saving rate of just 17%, is opting for a fiscal stimulus. That will push total national saving even lower – notwithstanding the vacuous self-funding assurances of supply-siders. As shock absorbers, overvalued financial markets are likely to be squeezed by the arbitrage between the world’s largest surplus and deficit savers. And asset-dependent real economies won’t be too far behind.

I agree with Stephen Roach’s analyses of global economics, macro or otherwise, much of the time. He’s done the research and pursued an active living from managing his understanding of economic trends. Especially in Asia. Now, he’s back in the US – back in the US – back in the USA – trying to broaden the understanding of global economics inside a nation where a larger percentage of the population prefer to pray for guidance than to investigate, analyze and learn.

How babies inhale dust, pollen and more – more than adults

We are interested in the biological material an infant inhales, especially during their first year of life when they are crawling. Many studies have shown that inhalation exposure to microbes and allergen-carrying particles in that portion of life plays a significant role in both the development of, and protection from, asthma and allergic diseases…”…“There are studies that have shown that being exposed to a high diversity and concentration of biological materials may reduce the prevalence of asthma and allergies later in life.”