Economic recovery - Like the US, we must face stark reality

PRESIDENT Barack Obama’s announcement on Sunday night that Congressional leaders had reached an agreement that would raise the US government’s borrowing limit and avoid default is good news for us all.

This was reflected in an immediate bounce in stock markets all around the world.

The prospect of an American default is almost too calamitous to imagine. Despite the accelerating ascendancy of other economies — China, India and Brazil for example — America remains the most powerful economy in the world and its wellbeing is of great concern to any country in its shadow.