Crisis scenarios update
Many signs indicate that the global economy's V-shaped recovery will continue, and that the outlook for Germany and Europe is bright. The stock markets at least have already anticipated a sharp upturn: from the depths plumbed last year, the DAX and EuroStoxx have rebounded by 60%. Upbeat expectations are buoyed by the forecasts of leading research institutions and organizations, according to which Germany's economy will grow by 1.8% and the USA's by 2.9%. In the view of the OECD, China's output will jump by 10.2%. The IWF expects global growth of 3.9%, thereby adjusting its forecast upward by 0.8 points.
We could see all this as welcome confirmation. After all, the first two scenarios we posited for economic development in Europe and Germany saw the V-curve as the probable outcome – contrary to the majority of professional prophets. Yes, our November 2008 publication also underestimated the depth of the recession. On the other hand, our very first scenario got it right about what would fuel the recovery. In April 2009, we analyzed three possible scenarios in detail – the V-, U- and L-curves. Even then, we estimated that the
V-curve was most likely with a probability of 70%. The U-curve had 25% probability and the L-curve just 2% – and we have nothing new to add to these predictions.