Experts see trouble ahead for developed world, especially US

Chairing a panel, CNBC anchor Maria Bartiromo drew laughs by challenging the scowling Roubini to come up with “any good news.”

He offered that “emerging economies have high potential growth.”

But even that comes with a caveat: Roubini warned that world growth leader China was too dependent on exports to the struggling West and predicted that within a year its economic growth will be overtaken by India, a huge nation much more reliant on its domestic market for development.

The leading Chinese delegate to the forum, Cheng Siwei, seemed to agree with the criticism. “We must change our investment pattern from investment driven to relying more on domestic consumption,” said Cheng, a former top Chinese official who chairs the China Soft-Science Research Society among other positions.

What about Greece, whose near-default four months ago rattled the nerves of investors around the globe?

“Greece will not make it,” said Sinn. He said the world can either subsidize Athens indefinitely, force a degree of austerity that actually risks “civil war,” or — in what he suggested was the least bad option — encourage Greece to restore its drachma currency despite the domestic banking collapse that could well result.

Sinn noted that bond spreads — the difference between the cost of borrowing for troubled countries such as Greece and solid ones such as Germany — have swiftly returned to the startling levels that preceded the Greek bailout in May.

Truman ended his remarks on a high note, noting that in recent quarters' “U.S. productivity increase has been significant.”

But that development, while good for companies' bottom lines, is also a reflection of the stagnant labor market and the shrinkage of payrolls as firms hope to produce as much as before with fewer and more productive staff.

In perhaps an illustration of that psychology, several hundred business leaders at the forum were asked for their projections on their own companies' prospects. Voting electronically, some 70 percent predicted a rise in turnover by the end of 2010 and almost half predicted a rise in their firms' investment.

But less than a third saw a chance for new hiring; almost half saw no change — and about a quarter predicted even more reductions.

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