government stimulus

At an annual convention leading economists were making predictions for the near future of the US economy with outlooks being grey to say the least. 2011 may be a year of declining recovery as government support measures are contracting while in the long run the United States must face up to inevitably being overtaken by China as the world's largest economy. And it may have missed a chance to rein in its largest financial institutions, many of whom remain too big to fail and are getting bigger.

The world’s largest wealth fund Abu Dhabi investment Authority (ADIA) expressed the opinion that the world economy is still facing "considerable uncertainty.”

The fund said that the viability of the recovery in the global economy is questionable because governments are now considering the rollbacks of stimulus measures.

As Federal Reserve Chairman Ben Bernanke and Nobel Prize winner Joseph Stiglitz are lauding the measures taken by the US government to wrestle the economic downturn claiming that prolonged spending has held up economic growth at a time when private consumption and investment has fallen off a cliff, many experts across the globe dispute the efficiency of stimulus policies implemented by national governments worldwide.

 Roger Nightingale, economist at Pointon York, made a statement that the world will inevitably be involved into another depression if the stimulus measures are ceased too soon.

On the other hand, Charles Lemonides, Chief investment Officer at Valueworks LLC, notes that the stock markets will likely survive the tough times without significant problems as economic activity is better than it was six months or a year ago.

"I think the economy is in a great deal of trouble," Nightingale told "Worldwide Exchange."