This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
$1 buys you full access to ALL of TheStreet's Subscription Services! Learn More

OECD: Europe Weighing On Global Economy

It also downgraded its forecasts for the U.S. economy and warned that it could be worse if the White House doesn't clinch a deal with lawmakers on the budget. Assuming a deal is thrashed out, the OECD has penciled in growth of 2 percent for the U.S. next year, down from a forecast of 2.6 percent in May.

The OECD cautioned that growth outside the OECD â¿¿ which comprises 34 developed economies mostly in North America and Europe - would be slightly faster but crimped by Europe's troubles.

"A slowdown has surfaced in many emerging market economies, partly reflecting the impact of the recession in Europe," said Pier Carlo Padoan, the OECD's chief economist.

The OECD also warned the U.S. and Europe against cutting spending too sharply and too quickly, saying that could further hurt growth prospects. It suggested that countries with stronger economies such as Germany and China could provide temporary fiscal stimulus to boost growth.

"Global prospects remain fragile, with strong downside risks, and are heavily dependent on the speed and decisiveness of policy actions," it said.

Padoan expressed concern about the so-called fiscal cliff in the U.S., automatic tax increases and steep spending cuts that take effect in January unless President Barack Obama and Congress reach a budget agreement.

"If the fiscal cliff is not avoided, a large negative shock could bring the U.S. and the global economy into recession," Padoan said.

The report argues for "measured" spending cuts and tax increases.

"Reducing the large federal budget deficit is necessary to restore fiscal sustainability, but this should be done gradually and in the context of a well-identified medium-term consolidation plan," Padoan said.

The report warned that unemployment would continue to rise in the eurozone from 11.1 percent this year to 12 percent in 2014, but that the rate in the U.S. would gradually decline to 7.5 percent in 2014.

Copyright 2011 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
2 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,817.90 +7.84 0.04%
S&P 500 2,069.41 +5.91 0.29%
NASDAQ 4,754.8920 +41.9220 0.89%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs