It’s a small world: what leaders must do to achieve a healthy global economy

By Money Matters Editors

The previous global economic expansion was riddled with structural imbalances. Provided the balances are addressed, a global economic recovery will follow, but the task is huge.

Economists and policy makers are starting to call the previous economic expansion the ‘Bush era’ or the era of the pseudo-economic boom - a period when unsustainable borrowing by American citizens masked, for a short period, structural imbalances that almost guaranteed that the U.S. and global economies would fall into recessions.

Those imbalances were laid bare once the U.S. home-as-ATM era ended when the U.S. housing sector collapsed, and the correcting of those imbalances is one reason the recession has been long and deep. Investors should monitor the major economies’ progress at ending these imbalances. Here’s an update: