UN says world economy could face abrupt, damaging correction

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UN says world economy could face abrupt, damaging correction
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Big News Network.com Tuesday 25th January, 2005

Imbalances in the world economy will not be corrected by a rapidly falling dollar since the depreciation is weakening demand in the United States' creditor countries and softening the benefits to US exporters of a cheaper trading currency, the United Nations says in a new report.

Assessing its 'World Economic Situation and Prospects 2005,' the UN Department of Economic and Social Affairs (DESA) says cyclical economic recovery reached a peak in 2004, especially for developing countries, and 'the possibility of an abrupt and globally damaging correction persists, since the depreciation of the dollar alone seems unlikely to be sufficient to reduce the global imbalances to sustainable levels in an orderly fashion.

'The global imbalance is between consumption and debt in the United States and ballooning surpluses in many US trading partners. Currency changes by themselves, especially bilateral currency manipulation, will not resolve the problem,' it adds.

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Even the UN is trying to tell Bush & Congress the deficits are huge!!!