by Calculated Risk on 4/26/2009 01:15:00 AM

The Economist cover story is titled A glimmer of hope? and cautions: "The worst thing for the world economy would be to assume the worst is over"

Click on cover for larger image in new window.

[W]elcome as it is, optimism contains two traps, one obvious, the other more subtle. The obvious trap is that confidence proves misplaced—that the glimmers of hope are misinterpreted as the beginnings of a strong recovery when all they really show is that the rate of decline is slowing. The subtler trap, particularly for politicians, is that confidence and better news create ruinous complacency. Optimism is one thing, but hubris that the world economy is returning to normal could hinder recovery and block policies to protect against a further plunge into the depths.
emphasis added