I have just got back from a visit to Korea. It's booming. National output rose 3% in real terms last year. Economic growth is accelerating. It grew at an annual rate of 3.7% in the past quarter and I reckon it's got further to go. Something near 6% this year looks likely.

US economic recovery is clearly under way. But is it a profitless recovery? Some bears say so. I don't agree. This year, corporate profits will not rise as much as the consensus forecasts. That's why I reckon that US Inc and the equity markets will recover at a canter rather than a gallop. But they will still rise sufficiently to support a 10% to 15% rise in equity prices by the year-end.

The world is in recession. But it won't be by the end of the year. It will be the US economy that will show the way out of the mire. And it will be the US consumer that will hold the centre in the battle against recession.

Back in January 1999 the euro was heralded as a strong currency that would soon outshine the dollar. Europe had a surplus on its external balance of payments and tight fiscal policies. The US had a huge current account deficit, net external liabilities and budget deficits. The dollar was bound to dive. How wrong the dollar bears have been.

Every indicator we look at shows that the world is in recession. That's the reality. It's always easier to drown if everyone else in the pool is drowning too. So who will be the lifeguard?

The US economic recovery will be delayed by the terrorist attacks of 11 September and anthrax scares. But in the wake of the US administration's massive monetary and fiscal policy boost since that tragic day, a V-shaped recovery in 2002 is now likely.

I am convinced that the outcome of the human tragedy of September 11 will be a gutsy renewal of solidarity and confidence, recently lacking in the US, on the part of Americans and foreigners.

The swing of the political pendulum in the US has had an equal and opposite reaction in Europe. In the 1990s, under the post-cold war order of transatlantic relations, Bill Clinton's centre-left US administration promoted its own brand of caring capitalism. Inflation was banished, the world economy grew strongly and financial markets soared.

A new emerging-market crisis, to follow that of 1998, has surfaced. The immediate Argentine crisis will be resolved. The politicians there have proposed budget cuts that, if supported domestically and implemented, will provide some relief for a while. But this won't address Argentina's growth dilemma. That's a supply-side issue and the downside of a vastly overvalued currency. And it won't do the trick of getting interest rates down to levels where Argentina could grow either. As for Turkey, I have no hope that interest rates there can be got down to sustainable levels either.

The euroland economy stinks of stagflation. Its politicians are faltering on reform amid electoral paranoia, and the threat to jobs from the global slowdown. That means, combined with the European Central Bank's confused interest-rate policy, that the outlook for capital flows into mainland Europe remains poor. I reckon that will continue to undermine the euro. The place to be in Europe is the UK, where I expect sterling will hold firm, despite the risk of possible early entry into the single-currency system.

Which economic bloc is going to perform best this year, Europe or North America? The consensus is that the US is heading for very low growth, say under 2%, while Europe will do better, with 2.5% at least.

South Africa is a contradictory country. Its economy is the size of Poland's or Thailand's. It has income disparities similar to Brazil's. In population and wage rates, it's Argentina. But it spends three times more of GDP on public education than China and twice as much as the average of all emerging markets.

In the first quarter of this year, the US Federal Reserve has cut interest rates by 150 basis points. But Nasdaq is down 25%, most European equity markets have fallen 15% to 20% and even the Dow, which had been flat for two years, is now off 14% for the year.

One of the great gainers from falling global interest rates will be emerging market financial assets - though not everywhere. I've just visited one emerging market that should outperform this year: Brazil.

The senior government official shook his head vigorously in affirmation. "Yes, Japan's budget deficit will grow. Yes, there will be a government bond crisis." Then he said: "The best scenario for Japan would be an earthquake that struck the downtown headquarters of the ruling Liberal Democrats when all its senior politicians were there. Then we might get some of the reform Japan needs."

Nasdaq is still collapsing and there are worries that the US economy could be recession bound as the tech investment boom ends. But I remain optimistic. I reckon the global economy is in for a super-soft landing to sub-3% growth in 2001. Oil prices will stay around $25 a barrel and global inflation will fall, boosting real incomes. Risk appetite will recover. The mini-bear market is almost over.

It's hard to imagine a worse news flow for markets. As I write, the US is without a winner in the presidential elections. The lawyers argue in the courts about whether various counties in Florida can conduct manual recounts. And people spend their time giving opinions on chads - those little round bits of paper hanging by a thread from the punch hole on a Florida ballot paper.

It's just one piece of bad news after another for markets at the moment. Falling stocks of oil in the US and the Arab-Israel nightmare are keeping oil prices well above Opec's stated target of $28 per barrel. Major US corporations announce each day earnings results that disappoint investors. The dot com and hi-tech sector takes a huge pounding.

When the euro was first launched in January 1999, the consensus was that a strong central bank, a huge trade surplus and low inflation would drive the new currency upwards from its opening level of $1.17. I had little confidence in that view.

The increasing pace of developments in both the syndicated loan and the debt capital markets

We are not quite at the end of the current equity market correction. The next few months may be volatile or downright violent. But I'd start buying into any downturn in US and European stocks right now - particularly in traditional economy sectors where smart management can apply cyber-magic to the benefit of shareholders.

Author: David Roche Bank of Japan governor Masaru Hayami missed a step when the bankruptcy of the Japanese retailer, Sogo, stopped him ending the zero interest-rate policy (ZIRP) at the BoJ’s July meeting. But he looks determined to end ZIRP within the next two months.

The days of the weak euro seem to be over. The euro has bounced back from the nadir of $0.88 to $0.96 now. But it's still way below the level of $1.17, when it was launched nearly 18 months ago. At the time of its launch, I forecast that the euro would slump to 1:1 against the dollar. When it reached that level, I expected it to turn round and head back up. But that prediction has been confounded so far.

"If I were Euromoney editor, I would beat up on institutional investors for the insanity they've been creating," says Allan Kennedy. He has written a book, The end of shareholder value, about the embracing of this ethic and its adverse aVect on business practices. Kennedy has seen the "insanity" spread at close quarters. He held a top position with McKinsey.

What's the signiWcance of Merrill Lynch's decision to appoint a British banker, Kevan Watts, in London as co-head of its global investment banking group? "The location is clearly a large part of it but my background outside the US also played a role," Watts says. Watts joined Merrill in 1981 and spent 17 years toiling for it outside the US. He worked in advisory and Wnance for UK clients in the 1980s and recalls Xoating Euromoney in 1986 at £4.60 a share. "It's been a very successful company," he says.

Dan Case couldn't do it. Roddy Fleming couldn't do it. Even Neal Garonzik, long-time friend of Chase CEO William Harrison, couldn't do it. Through all the quiet discussions to buy a top investment bank and the change of tack last year to build through smaller acquisitions, vice-chairman Jimmy Lee remained king of Chase's investment banking heap.

What do you give to a man who has everything? For her husband, Alison Lutnick chose a round of golf with Tiger Woods. For $51,000 husband Howard, CEO of inter-dealer broker Cantor Fitzgerald, joined three others in playing 18 holes with golfer Woods last month.

The high-tech stock market mania has come to a screeching halt. The US Nasdaq index is now down 20% from its highs. Does this herald the beginning of a huge secular meltdown in stocks around the world? I think not. On the contrary, it marks a healthy reallocation of capital away from companies of the "new" economy towards the "old". The major argument against this optimistic view is that the new cyber economy will destroy us all by creating competition so great that prices will collapse faster than costs. Then whole swathes of the traditional economy will be wiped out, as capital structures collapse.

As I write, the euro stays deep in its despond at just $0.96/e. That's a far cry from $1.15/e at its launch. Why does the euro stay weak?

Is Japan heading back into recession? The news out of the country's Ministry of Finance is that Japan's national output probably fell in the last quarter of 1999, after shrinking by 1% in the third quarter. Technically that's a recession. Will this new downturn continue and what does it mean for the Nikkei and the yen? You can answer these questions if you understand the plate-shift movements taking place under the surface of Japan's seemingly stagnant economy.