The World Economy will get better -- sooner than you think!

Is the economic outlook really as bleak as the so called (and oft-wrong) "experts" forecast? I strongly doubt it. I even dare say that the world economy will be in full swing upward from the last quarter of this year. Why? Three simple reasons really: room for growth (developing/virtual economies), the law of rebound (major implosions happened already, suppressed demands, lower costs) and the existence of re-circulation infrastructure (Information Technology, Financial technology and globalisation.) Here is a bit more details:

A. Room for Growth:

(1) The continuing emergence of already HUGE, still GROWING, globally ACCESSIBLE and positively EXPLOITABLE Markets of China, India, Russia, Brazil, Indonesia, etc.

(2) The continuing emergence of already HUGE, still GROWING, globally ACCESSIBLE and positively EXPLOITABLE virtual economy as exemplified by ebay, amazon, google, countless number of online shops/businesses etc.

B. The law of rebound:

(3) Much lower prices of oil, agricultural products and base materials.

(4) Much lower prices of labour and service costs including that of transport.

(5) Suppressed demands for goods and services that have been accumulating.

(6) The major financial implosions happened already: more to come no doubt, but the main ones passed. So the big risk factors are gone (and now it is the after-match that people are worried about anyway).

C. The Re-circulation Infrastructure

(7) The hyper-low viscosity of information flow: this can cause the economic mood to swing upward very rapidly (as well as downward as it seems to have happened last year).

(8) The hyper-low viscosity of credit flow: money (credit) can flow so fast that it can compensate the low volume : (remember momentum equals mass x velocity)

(9) The financial knowledge: yes the leverage financing has taught something as well, I believe, which will, at the end, contain the financial melt-down.

Also, let's not forget the Murphy's Law: In economics, the majority forecast is always self-defeating because it always pays to act contrary.

You might say that all these factors point to long-term recovery rather than short-term. This depends on where you view the equilibrium lies on the economic vitality yard stick. If the equilibrium lies far below the 2007 peak, then the "recovery" will indeed be long term.

I, myself, think that the equilibrium really is quite near the peak and therefore the current down turn is an abnormally. How do I justify it? The fact is that for the past 35 years, the economy has been mostly growing and not just because of reckless borrowing, but because of a positive belief and expectation of the fundamental (which is justifiable): accelerating productivity growth due to technological advancement and emergence of new markets real/virtual. What about all the bad debts (ratio)? Remember that the other side of the world has been saving it (China for example) and the credit flow is relatively free across the globe.