One positive surprise in the global economy - limited protectionist rhetoric

The Economist had a interesting article theme in this week's addition, the lack of protectionism in the global economy. This is after world trade has declined by 1/3 in the last year. Make no mistake there is more rhetoric associated with trade and there have been more cases before the WTO, but generally there has been less wholesale talk of raising tariffs and discussing dumping by trading partners. Conversations to restart the Doha trade talks have continued even though they have dragged on for years.

This means that we may be able to get back to more normal growth than what occurred during the Great Depression. There are reasons for the change in trade patterns over the last few decades. Trade has become more sensitive to GDP. Trade in components within a firm has also exploded. This recession has seen massive increases in inventory which are being sold off first. Trade was cut preemptively. All of this has been a good sign for the long-run. We hope it continues.