Turns out TD Bank is more of a bear than the World Bank when it comes gloomy economic forecasts. And yet, its the World Bank that apparently has the power to make investors around the world simultaneously jump off a cliff.
The Washington-based World Bank said today that the global economy is going to contract next year by 2.9 per cent. Seconds later, everyone everywhere apparently yelled “Sell!”. The benchmark TSX Composite Index was down 450 points today or 4.4 per cent. The Dow Jones Industrial Average was off about 2 per cent.
TD, though, promptly looked at the World Bank's forecast and noted that, hey, the World Bank's forecasters aren't nearly as gloomy as Don Drummond [PDF}and his band of merry econometricians on the 21st floor of the TD Tower in downtown Toronto.
In fact, according to the TD number crunchers, when it and the World Bank uses the same forecasting model, the World Bank has the global economy shrinking by just 1.7 per cent next year compared to 1.9 per cent for the TD guys.
Feel better now?
Is it really possible to feel good nowadays ? … just before the big crunch !