Posts tagged 'This Time Is Different'

Long-term pessimism, short-term frothiness, and the recovery in world wealth

It’s no secret that FT Alphaville pays attention to the periodic papers released by the team of Jonathan Wilmot, James Sweeney & Co. Their earlier work on shadow banking and collateral was thoughtful and ahead of its time, and we also agreed with Sweeney’s generally optimistic view of an accelerating US economic rebound led by the knock-on effects of a recovery in household formation, a favourite subject of ours.

Their latest is an extension of a prior piece that looked at the state of global investor risk appetite — and which concluded that although there remain obvious problems in parts of the developed world, overall the global recovery from the trough in early 2009 has actually outpaced previous recoveries, exactly as would be expected given the fall in the output gap this time round. Read more