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The Biz Roundup January 3

We never see a headline about a breadline today.

In the midst of the deepest recession in the experience of most Americans, many professional forecasters are optimistically heading into the new year declaring that the worst may soon be over. For this rosy picture to play out, they are counting on the Obama administration and Congress to come through with a substantial stimulus package, at least $675 billion over two years. . . . If the dominoes fall the right way, the economy should bottom out and start growing again in small steps by July, according to the December survey of 50 professional forecasters by Blue Chip Economic Indicators.

(“Some Forecasters See a Fast Economic Recovery,” New York Times, January 3) Of course, it doesn’t add any credibility to their case that these very same forecasters (who are surveyed by the Blue Chip Economic Indicators) missed the economic downturn until we were six months into it! Life is a bowl of cherries, indeed.

The Chinese are bailing out their auto and steel industries — c’mon Congress Dudes, get behind the home team!

The nation’s economic stimulus measures will go beyond the announced 4-trillion-yuan package as more industry-specific policies are rolled out, Premier Wen Jiabao said on Friday. . . . A number of industry-tailored policies are in the making, and two of them, for the auto and steel industries, have already been drafted, Wen said without elaborating.

(“Additional stimulus plan in the pipeline,” China Daily, January 3) Check this one out. The Chinese are moving aggressively to stimulate their economy because GDP growth has slowed from 11.9% to 9%. How’s that for being in front of the curve? Just in case you had put those outsourcing-to-China plans on hold.

On the bright side, you could be living here.

The year 2008 will go down as a historic one for both good and bad reasons on the economic front. The country’s official inflation rate was 100 580.2% in January rising to 231 million % in July. Inflation figures have not been announced since, with independent economic analysts estimating the rate to be above one billion percent. . . . Reserve bank Governor Gideon Gono removed 13 zeroes from the currency in a move which has not been helpful as it was not backed by increased production from all major sectors of the economy. So bad has been the economic environment that Gono introduced 27 new denominations this year alone.

(“2008: Another Year Of Marked Economic Decline,” Zimbabwe Independent, December 18) One billion percent. If we had a one billion percent inflation rate for just one day, you could wake up in the morning and you could completely pay off your jumbo mortgage loan on your 25,000 square foot Beverly Hills home by the time you finished your breakfast just by selling someone a loaf of bread. Me? I love the “official” inflation rate being pegged at 100,583 point two percent. Shake your head all you want, you’ve got to admire the sheer unbridled chutzpah in that decimal.

University of Zimbabwe Graduate School of Business professor Tony Hawkins is however sceptical whether the formation of a new all-inclusive government would result in immediate buoyancy. “We should be realistic and mature about the post crisis period,” Hawkins warned. “Indigenisation without external lines of credit is not enough to resuscitate the economy. It could take up to 15 years for the economy to reach mid-90s levels.”

There’s a University of Zimbabwe Graduate School of Business? What do they teach? Prayer?

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