Will Chicken Licken prevail or will she be gobbled up by Foxy Loxy?
There is more to this parable. Chicken Licken eventually gets eaten by the fox. So will the chicken or fox prevail? If you live in rural Australia you know that the fox will prevail unless something comes out of left field like a farmer with a gun. Well that’s also the economic story. The sky is not falling in. As pointed out in previous weekly’s the world economy will have fits and starts as it emerges from the economic downturn and as pointed out in last week’s note the economic downturn has been so severe in the US that it is still expecting unemployment to be 8.5 % in 2012. The guns are the level of debt in Eastern Europe being carried by the Western banks, continuing weakness in the Japanese economy and a currency mismatch between China and the rest of the world. So there is plenty to worry about if you want to make yourself miserable. Last week was a reality check for many in the financial markets but as a resident of rural Australia I’d back the fox to clean up the Chicken Licke
