Peter Hall

Believe it or not, US consumers have pulled off a dramatic U-turn. Addicted to debt in the boom years, the world’s biggest consumers are pinching their pennies at a rate few thought possible just a year ago.

Once again, the ‘R’ word is everywhere – although this time, it’s not recession, but recovery. Positive signals in the economy are mounting, setting off lots of ‘recovery buzz’.

Decades of multilateral effort and untold resources have been devoted to freeing up global trade flows. Enter a severe recession, and suddenly all that effort is at risk. Protectionism, the arch enemy of international trade, is in vogue again.

Globalization revolutionized world commerce in the 1990s, and Mexico joined the movement with gusto. This decision paid dividends to the Mexican economy for over a decade.

If the past 18 years were like a bad dream for Japan’s economy, the past 15 months have been a nightmare. But second-quarter stats show that the Japanese economy jumped by 2.3%, outshining the rest of the G-7 economies by a wide margin.

Crisis brought on a torrent of public stimulus announcements last year. Plans are being implemented, and the impact on growth is huge. But in the rush to declare the recession over, there is also concern that stimulus not be withdrawn too quickly.

Trade hubs the world over have been pummelled by the global recession. World trade flows are forecast to fall 12% this year, many times the drop in global GDP. One wouldn’t expect this context to be very kind to Panama.

It’s the wrong time of year for the elusive loon to be flying north. But the one on the dollar coin is doing just that, as concerned exporters and economy-watchers look on.

Recovery-talk has been dominated by a discussion of letters. There’s the rapid V-, the protracted U-, the double-dip W-, and the dreaded L-shaped recovery. Recent positive economic signals have resuscitated hopes of a V-shaped rebound.

Panic-laced talk of capacity shortages at North America’s West Coast ports has gone silent. Hardly a surprise, given that world trade flows are expected to drop 12% this year.