PAM Perspectives Q4 2009
| 12 November 2009 |
| Stimulus withdrawal is the next challenge for governments The greatest global stimulus programme ever witnessed has saved financial markets from entering the abyss, and has paved the way for economic recovery. Relieved investors have regained their appetite for risky assets, sending equities soaring seventy percent since their March lows. But the job is not yet complete – fumble the exit, and governments put at risk all they have achieved. |
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Neither be too soon, nor too late In the past twelve months developed countries have resuscitated the global financial system with massive liquidity injections and loose money. But unprecedented levels of fiscal and monetary support cannot continue forever. So 2010 will inevitably see some withdrawal of government stimulus from the economy, but timing this well will not be easy, as the IMF has recently commentated. |
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