Having worked with both Reuters and Bloomberg, we tend to keep a close eye on their editorial products. It is not unusual for both of these fine news and data organizations to have similar stories on any given day—after all they both cover the same financial markets beat. However, for each to have almost identical “big picture” stories on the same morning is something to take note of.
On Monday morning, 11/7/11, the following headlines and leads could be found on their websites:
REUTERS: “CHINA/U.S. WITHSTAND EUROPE’S TURMOIL”
“So far, the United States and China have shown a welcome resilience to turmoil from Europe, revealing a disconnect between sentiment and what is happening in the real economy.
BLOOMBERG: “WORLD DODGES SLUMP WITH CHINA-U.S. BUOY”
“The global economy is showing signs of withstanding a European recession triggered by the debt debacle in Greece.”
Both stories go on to make very similar points in defense of the argument that there may be an overall slowdown to some degree in the world’s economy, but that the damage should be minimal, thanks to Asian and U.S. relative strength.
They cite:
- slow but steady improvement in the U.S. labor market
- anticipation of a decent Holiday retail season and pent-up consumer demand
- positive signs in U.S. automotive sales
- improved capital spending by U.S. businesses and improved worker productivity
- continued expansion of Chinese manufacturing, although at a bit slower rate than year ago, and a continued quite healthy China GDP
- GDP growth in Japan last quarter for the first time in a year
- global growth estimates of just under 3% for next year, not terrific but stable
- historical data which suggests that “mild” European recessions do not necessarily tip the world into recession
“Barring Italy turning into Greece, we’ll have a slowdown in the world economy but it should be a manageable one,” says Jim O’Neill, chairman of Goldman Sachs Asset Mgt. in London.
(Note: All eyes will be on some key economic data reports coming out of China this week as confirmation of this global growth/resilience story.)
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