At Project Syndicate, Barry Eichengreen gives his take on what is likely to happen in the global economy in the coming year.  Eichengreen is neither a doomsayer nor a bright-eyed optimist, and so he may not get a lot of airtime to share his projections.  Instead, he tells us to expect the EU, US, and China will all "muddle through," in 2012.

While the eurozone is unlikely to collapse in 2012, there will be no definitive answer to the question of whether the euro will survive, because there will be no quantum leap in European integration. Treaty revisions take time to draft – and more time to ratify. Efforts to strengthen Europe’s fiscal rules, for example, will take the form of bilateral agreements between governments, rather than changes in the European Union’s Lisbon Treaty.

It is a sad state of affairs when a recession qualifies as muddling through. But such is the European condition.

Consider next the United States. While recent data suggest that the economy is doing better – all signs are that GDP will have expanded at a 3% annual rate in the fourth quarter of 2011 – it is important not get carried away. Fiscal support for the expansion will continue to be withdrawn.  And, while the housing market shows some signs of stabilizing, prices will remain weighed down by the large shadow inventory of homes in foreclosure and held by banks.

These considerations suggest that the acceleration of US growth that began in the third quarter of 2011 is unlikely to be sustained. At the same time, if growth slows significantly, the US Federal Reserve will undoubtedly respond with another round of quantitative easing – QE3 by another name. Thus, while growth next year is likely to fall well short of 3%, the US should be able to avoid a double-dip recession.

Finally, China should grow by 7.5-8% in 2012. This is muddling through, Chinese style –considerably slower growth than the double-digit rates of the past, but not the hard landing that purveyors of doom and gloom warn is inevitable.

Read Disaster Can Wait here.