The world of economics turned inside out

Slowly but surely, a bruised and battered global economy now appears to be shaking off its deep post-global financial crisis malaise. If the International Monetary Fund's latest forecasts are borne out - an iffy proposition, to be sure - the nearly 3.6 percent average annual growth in world GDP expected in the 2017-18 period would represent a modest uptick from the 3.2 percent pace of the past two years. A decade after the global financial crisis, global growth is finally returning to its 3.5 percent post-1980 trend.

But this round trip hardly signals that the world is back to normal. On the contrary, the overhyped idea of a "new normal" for the world economy overlooks an extraordinary transformation in the global growth dynamic over the past nine years.

At the margin, the recent improvement has been concentrated in the advanced economies, where GDP growth is now expected to average 2 percent in 2017-18 - a meaningful pickup from the unprecedentedly anemic 1.1 percent average growth of the preceding nine years. Relative strength in the United States (2.4 percent) is expected to be offset by weakness in both Europe (1.7 percent) and Japan (0.9 percent). However, annual growth in the advanced economies is expected to remain considerably below the longer-term trend of 2.9 percent recorded during the 1980-2007 period.