Everything’s rosy, of course……
“HSBC sees China and America leading global mega-boom” blasts the headline from the Telegraph yesterday:
“The greatest global boom of all time has barely begun. Over the next forty years, economic growth will quicken yet further as the rising powers of Asia, the Middle East, and Latin America reach their full stride.”
Right, so everything’s rosy in the world of global economics. Until, of course, you read the small print:
“HSBC works from the assumption that mankind will avoid the energy crunch and overcome the eco-deficit, a term used to describe the world’s depletion rate of non-renewable assets. It calls for $46 trillion of investments in alternative forms of energy to break out of the carbon trap, and head off a supply crisis that could derail growth.”
So we have a headline grabbing message with no caveat whatsoever, yet the body of the article explains that the assumptions behind the forecasts are of stupifying proportions. In order for the Mega Boom to materialise we just need to find as much cheap and easy energy sources as we’ve been used to the last 100 years or so, we need to stop damaging the environment and we need to find more clean water and cheap food to feed everyone, plus we need to invest far more money than we’ve currently spent bailing out the banks.
I think we can just sweep these little assumptions under the carpet, can’t we? Doubt they’ll affect the outcome of the forecast.
Bad science, bad economics, and bad journalism.