Recovery in Progress

The Economist (2010). Recovery in progress: World trade is on the mend, but the strength of the rebound remains uncertain. Retrieved March 20, 2010 from: http://www.economist.com/business-finance/displaystory.cfm?story_id=15599453&fsrc=rss

This article is published on The Economist Online website and discussed the possibility of an economic recovery in progress. According to the Netherlands Bureau of Economic Policy Analysis (CPB), which tracks global trade volumes, the last quarter of 2009 showed renewed vigor with a 6% increase. However, with a huge 13.9% reduction in trade volume in 2009, which is only the third drop since they started tracking these numbers in 1961 and a lot bigger drop than the 1.9% and 0.9% in 1975 and 1982, respectively, there is a long way to go before the crisis is over. They also point out that December’s trade volume can skew the numbers some because of holiday spending in many parts of the world. Also concerning is that the World Bank, which tracks trade value instead of volume, states that there was a deceleration in the last quarter of 2009 in that measure, so the recovery is weak at best. This article is important for managers to understand because it is important to know what is going on in the world economy and how it affects your business decisions. As the economy improves, it is important for managers to make the correct business decisions based upon their particular circumstances within the current economic conditions.