The Global Economy : Heading Towards Collapse Or Stability

2257 Words10 Pages
Taylor Dawson
Zachary Bankston
Expository Writing
April 9, 2016
The Global Economy: Heading Towards Collapse or Stability
The global economy has always been a topic of discussion, whether the discussion is about its improvement or disintegration. Coming out of the 2008 recession, there was little hope for an improvement in the global economy, and citizens of the world were less than optimistic about growth opportunities. That being true, it appears that most individual economies have reached a near-stable state, in which they are not oscillating much; but whether that can be expected to last is now the question on economists’ minds. There is argument as to whether or not to expect the economy to crash this year, 2016, and why it would or
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While this may not seem like a significant fall in economic growth rates, ¾ of a percent can dramatically impact the state of the economy. If the growth rate were to drop another ¾ of a percent, making it 2.25%, there would be no hope of escaping 2016 without a global recession. The question that remains is, what factors are influencing the economic growth rate’s decrease?
Stephanie Flanders elucidates some reasons for the slowing economic growth, and reasons for economic collapse in her article for J.P. Morgan. The key reason she cites for the latter is the divergence between developing and developed economies (Flanders). Developing economies are those that come from a developing country, whereas developed economies are found in countries that are established and not considered developing anymore. “Global trade is weak, China’s demand for key capital goods and commodities has slumped and producer prices are falling in 14 of the 20 largest economies in the world. Now it is developed economy consumers that are carrying the global recovery forward” (Flanders). In the past, developing economies have been looked to for economic growth; but as Flanders states, developing economies are struggling to continue to grow. Thus, the economies of developed nations are now being viewed as the most important in determining the growth of the economy in 2016.
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