Had you even heard of the term quantitative easing a year ago? You may not have been alone in your ignorance. Even a cursory look at Google Trends shows that searches for the term went ballistic after December 2008, when shell-shocked folk were trying to understand what central banks were doing to prevent a global financial meltdown.
Each year has its favourite buzzwords. We have recently detected a new creature on the horizon: the new normal. Wal-Mart Stores Inc. CEO Mike Duke used the term in a recent speech to shareholders: “There is a ‘new normal’ in which people want to save money and are getting smarter about saving money.” McKinsey and Co., never slow to grab a smart term, has put out a report on “IT in the new normal”. Even former Reserve Bank of India governor Y.V. Reddy mentioned the new normal in a recent speech on economic policy.
This phrase tells us a lot about the state of the world in 2010. New normal assumes that there will be a return to normality, but a normality that is very different from that seen in the bubble years.