Davos Brimming With Optimism for 'New Reality'

But rising food prices, political uncertainty are cause for concern
By Kevin Spak,  Newser Staff
Posted Jan 26, 2011 8:20 AM CST
'New Reality': Davos World Economic Forum Optimistic
Attendees mingle at the World Economic Forum in Davos, Switzerland on Wednesday, Jan. 26, 2011.   (AP Photo/Virginia Mayo)

The Davos World Economic Forum is an optimistic place this year—the theme is “Shared Norms for the New Reality,” meaning the post-financial-crisis reality. In a poll, 48% of the assembled CEOs said they were “very confident” of growth in the next 12 months, according to the Guardian. In his presentation today, even Nouriel “Doctor Doom” Roubini himself said the risks of a double-dip recession had lessened. But that doesn’t mean there wasn’t a lot to discuss. Here’s what CEOs were talking about:

  • China is now the world’s No. 2 economy. “We have to get out of the lexicon the words ‘developing’ or ‘emerging,’” said one advertising CEO. One finance professor, meanwhile, told the AP that “every uncertainty in the world has to do with Chinese politics.”
  • Food prices are soaring to record highs, as are prices on other commodities, one panel warned. “It’s not going to derail the global recovery,” one economist told MarketWatch, “But it’s a big problem for the poorest countries.
  • Interest rates are near zero now, “but they can only go up and higher interest rates will drive financing costs up as well,” said GE Energy’s CEO.
  • Political unrest is a big risk in many countries, especially in the wake of Tunisia’s revolution. “In Egypt, I really can't say where this is going to go,” a member of the Saudi royal family told Reuters.
  • Europe’s woes are a sign that financial growth hasn’t led to jobs, according to the head of a Paris-based trade union. “There is a gap between financial markets and real economy and that has to be bridged.”
(Read more Davos stories.)

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