Roubini on Structural Problems in the World Economy

In an interesting piece, Roubini points to structural problems in the world economy:

There is a huge excess capacity for the production
of manufactured goods in the global economy, as the massive, and
excessive, capital expenditure in China and Asia (Chinese real
investment is now close to 50% of gross domestic product) has created
an excess supply of goods that will remain unsold as global aggregate
demand falls.

Odd company or not, note that to the extent that Roubini is correct that past credit excesses have resulted in over-capacity (ala ABC) then our present problems go considerably beyond credit supply.  Tyler is more optimistic than me on these matters.


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