Please follow the link below to read a very interesting article predicting a recovery in U.S. economy.
http://www.forbes.com/2009/03/26/gdp-recession-q4-markets-economy-commerce-bonds.html
Then comment on the following questions:
1. Do you agree with the views expressed in the article? Why or why not?
2. What does this mean for Costa Rica?
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I am not sure if we already reached a bottom or it will happen in the second quarter of 2009. Every day the market receive different news, which can change your previous opinions. For instance, today US Goverment announced that some banks will need additional aids, also some analyst estimate that consumer spending and company revenues remains weak. As a result, today the Dow Jones gauge dropped about 250 points. Since Costa Rican exports and foreign direct investment depends on USA, a recovery in the US economy will definitely benefit us, so let´s pray to see a recovery in the second quarter of 2009.
ReplyDeleteSilvia said...
ReplyDeleteFollowing Carlos' idea, markets are still nervous, it is hard to be sure if we have reach a bottom, I would say that we need more positive news. At this point we are seeing, probably, a bottom at the housing market. Remember that, it is here where everything started, so one can expect to be one of the first sectors to recover.
After the housing market shows recovery one can see the banks opening back the credit facilities, and after that the consumer spending will increase. Once consumers go back to the stores we can see a fundamental to define a bottom. Before this happens it will be very important to see all the packages working and the companies such a AIG, banks and auto makers normalized (it is a key point to return confidence to consumers).
In this scenario CR will experience a real recovery or way back to normal once USA starts pushing their consumer spending and then their imports.