Jim O'Neill, chief economist at Goldman Sachs, says Canada is a "shining example to countries under pressure" on how to bounce back from the recession and get out of debt.
“It’s easy to say every developed country has problems — but Canada doesn't,” O’Neill says. "If you look within the G-7, perhaps Canada is a shining example for many countries under pressure.”
Canada had its own severe debt problems 20 years ago, O’Neill notes. “They've demonstrated that you can undertake significant structural reform without killing yourself," he told CNBC.
Canada, he points out, avoided the sharp downturn experienced by other developed nations by limiting leverage, protecting consumers and avoiding excessive deregulation of their financial industry.
O’Neill observes there are “deep-seated fragilities” in Europe, primarily attributed to debt — but having a lot of debt is “not a reliable predictor, it's just a fact.” A lot of countries must realize that the market isn’t “daft,” he says.
Noting that the U.K. manufacturing purchasing managers’ index (PMI) grew at its fastest pace in 16 years, O’Neill says that, "at the margins, people are slowly starting to think the U.K. is not such a basket case, and perhaps Anglo-Saxon countries can grow and others can't.”
Elizabeth Miller, president of Summit Place Financial Advisors, told the Wall Street Journal, said that "we have very clear investor concern for Europe and deep uncertainty as to how that may affect other global economies and specifically our recovery.”
But balancing that, "we are continuing to get a stream of domestic economic news that shows as of now the U.S. recovery is deeply entrenched and on a positive track,” Miller said.
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