Recession Could Run Deep Amartya Sen - Oct 21, 2008

The depth of the crisis in the US economy and whether it should be described as recession is a contentious and much debated question over the past few days.Well, with recent economic data confirming the painful downturn in the US economy, now the experts are confirming that the worst is in fact true. I believe we are in a recession already not that we are getting there. It could become deep if nothing is done about it. I am sure something will be done about it and we should be able to make it a fairly shallow recession and turn it around, said Nobel laureate and eminent economist Amartya Sen.

But with the big daddy going down, will the emerging countries be able to come out stronger from the deepening US recession and credit crunch?India, China are less affected at least initially because we are not as dependent but we are affected as many of the booming sectors have a clear trade connection, said Sen.In the long run we may be very well affected and I do not mean Sensex going down.

There are bigger problems like unemployment, and the possible slackening of the economy. These things are something that we need to be careful about, pointed out Sen.Even John Thornton, former president of the investment bank Goldman Sachs, believes that no country is the same and so India and China will have to depend on their own models for saving themselves from the crisis.