Does anybody actually believe anything that the economists tell us these days ?

Not only did the majority of all German, US, and UK economists get it wrong back in 2007 when the economies of the world were overheating and all were living in La-La land on stock market valuations, house valuations, and what not, not many of those economists ever issued a mea culpa after the Great Meltdown of 2008. We are still in that meltdown, by the way.

Once again, the International Monetary Fund (IMF) chief Strauss-Kahn expects 2010 global growth faster than 3% forecast; Growth in advanced economies expected to be "sluggish"; Strauss-Kahn sees emerging nations tightening policies sooner :
- Asia should raise domestic demand and trade ;
- Governments should shift stimulus focus toward jobs ;
- The return of risk appetite poses market bubble concerns ;
- Does not see double-dip global recession (of course not) ;
- Reiterates that premature stimulus exit (ie. raising interest rates) risks double-dip.
- he is not seeing Asian asset bubble; Inflation in China is subdued
- Capital flows to Asia pose risks of reversal
- Biggest risk for Asia is slowdown in developed economies
- the chinese Yuan must trade freely to be considered an international currency

In my daily work, I deal with alot of people and alot of companies.

Time and again, I am confronted with companies and people in Germany or the US or wherever that say they are in business. My question in retrospect is : "In the business of what?"

Wasting my time, wasting my resources, talking shop? What about actually doing something productive? In my dealings with China and India, about after thirty seconds of talking, my counterpart says something like, "OK, so how do we do business? What do you want?... here is what I want..." This does not mean that doing business with Asians is easy - there are cultural issues in ways of doing business and understanding. But the point is : one sees they are hungry to get something moving, to get to the point, to try and be productive and make some money.

Voila - that is business. Not exchanging formal emails for 3 weeks and "setting up a meeting" to talk.

What has happened to the passion, the deal-making, the vision, the hunger with business-people in Europe? It's like everybody is on valium. "Business, ja, good idea. What ?, huh ?"

I fear that growth of 3% in Germany or US or wherever else is a fallacy. In fact, last quarter, the Germany economy contracted 5%. So in fact, the economists are telling us that we will have a net 8% growth. Dreamers.

The point is this : for growth to happen, it requires credit from institutions, risk-takers, people with a healthy attitude toward risk and plenty of hard work. Plenty. It also requires understanding the new economy of the internet, of knowledge based work, of new marketing concepts, etc. Most people I interview for jobs can just about boot up their PCs - when I ask for relatively simple tasks like doing some mathematical spreadsheets in Excel, or some outline of business ideas, I get a blank stare.

Growth at net 8% - I simply don't see that. We have become "soft". We hold our hands out to government and cry aloud "Forgive me, for I have sinned - I have twiddled away my savings and made unintelligent decisions. I have little real-world skills and now I don't know what to do. May I have some money, for I am entitled to it"

This is the core of the problem. Only when citizens will stand up and take control over their decisions and their lives, will we have real growth. In the meantime, all those who have done this, will simply pay for those who have not. This is not a recipe for growth ; but it is a recipe for stagnation and dependency upon the State.

Randolph Buss
Economic Research | Wealth Management | Project Finance