That's the most pessimistic prediction so far from a major research body. The interrelation of world financial markets, says the OECD, means that few countries will escape the effects of the Asian crisis. But the OECD hints that things could get very nasty for the US and the world. With Japan, the 2nd largest economy, looking increasingly fragile, the OECD says it may have to revise its findings over the next few months. In London I'm Stephen Beard for Marketplace.
Fragility is the polite way to describe the economic situation here.
According to a survey out today of over 9000 companies, business confidence bellyflopped over the last three months. It sank even lower than the gloomiest analyst predicted. Consumers are not spending, other countries in Asia are not buying, and banks are so wobbly they are afraid to lend money to anyone who really needs it. Richard Jerome is an economist at ING Baring Securities. Unfortunately he's boxed himself into a corner because he said reducing the budget deficit is the most important policy objective, and you can't cut taxes and reduce the budget deficit.