The figure below shows that trade and industrial production have returned to pre-crisis level. Look carefully. The recovery relates to by volume measure. The growth rate of trade and industrial production is still down after months of incline.
The recovery, measured by growth rate, of trade and industrial production potentially looks like a W-shaped recovery (the level of troughs might differ depending on government activism!). When government intervention for aggregate demand management was high, both trade and industrial production growth rate was increasing. Now, since this is forgone because of austerity fetish in most of the countries, growth rate is beginning to come down as well. See the dent on output loss in developed countries. Andrew Burns argues that this might be permanent. Look at China’s output. Its surging upwards. The price of hands off approach by governments in developed countries is clearly seen in the figure.
By volume, global industrial production, the sector of activity most affected by the crisis—which fell by 10 percent between August 2008 and January 2009—regained pre-crisis activity levels by March 2010. Trade, which had declined by 19 percent in volume terms as of January 2009, has also regained pre-crisis levels, although somewhat later than industrial production.
For more see this piece by Andrew Burns.
