Economic Recovery Patterns and Globally Divergent Challenges to Recovery

Executive Summary: Some interesting ideas, including one by Stiglitz (link below) were proposed to manage the global financial crisis. How do those ideas look now? Do we have a path to "full" recovery yet?

Solutions and Paths to Recovery
I had talked about an interesting article by Stiglitz toward a co-ordinated approach to the global financial crisis below:
http://randomjunkyramblings.blogspot.com/2009/01/stiglitz-wrote-interesting-article-in.html

Globally Divergent Challenges to Recovery
The Economist had two articles, below, on paths to recovery that add more perspective to Stiglitz's article:
The Great Stabilisation
http://www.economist.com/opinion/displaystory.cfm?story_id=15127608
Leaders and laggards
http://www.economist.com/businessfinance/PrinterFriendly.cfm?story_id=14816736


What do you think?



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Innovation, Sentiment, Economics, and the Market

The thought “one company’s cost savings are another company’s lost revenue” below offers interesting economic insight:
{ On Private Equity: Scott Schoen, THL }
http://randomjunkyramblings.blogspot.com/2009/04/on-private-equity-scott-schoen-thl.html

As I have pointed out in this blog based on Shiller’s and Stiglitz’s articles, “sentiment”/ “perception” and other such “soft” or “behavioral” aspects play an important part in the economic engine of a region: {Financial Transactions, Trust and Keynesian "Animal Spirits"} & {Financial Markets, Economic Crises And Global Co-ordination}
http://randomjunkyramblings.blogspot.com/2009/01/financial-transactions-trust-and.html

Economic contraction would lead to a destruction of value through the destruction of existing market players, structures and relationships, before the economic engine restarts. This may lead to a slower recovery. This can be a good rationale for a central bank investing in an economy to keep it afloat in such a way.

However, once we accept that “sentiment” is a factor in the economic engine; could the effort to maintain existing market players, structures and relationships also impact the incentives for the economic engine to generate lasting recovery?

What do you think?