When’s the last time you thought about the possibility of global economic meltdown this year? Funny how when the European crisis left the front page, it seemed like the worst had passed. Probably not. The World Bank is just out with its 2012 forecast, and it’s pretty gloomy. Excerpt:

However, even achieving these much weaker outturns is very uncertain. The downturn in Europe and the slow growth in developing countries could reinforce one another more than is anticipated in the baseline scenario, resulting in even weaker outturns and further complicating efforts to restore market confidence.

Meanwhile, the medium-term challenge represented by high debts and slow trend growth in other highincome countries has not been resolved and could trigger sudden adverse shocks. Additional risks to the outlook include the possibility that political tensions in the Middle East and North Africa disrupt oil supply, and the possibility of a hard landing in one or more important middle-income countries.

While the situation in high-income Europe is contained for the moment, if the crisis expands and markets deny financing to several additional European economies, outturns could be much worse, with global GDP more than 4 percent lower than in the baseline. Although such a crisis, should it occur, would be centered in Europe, developing countries would feel its effects deeply, with developing country GDP declining by 4.2 percent by 2013.

In the event of a major crisis, the downturn may well be longer than in 2008/09 because high-income countries do not have the fiscal or monetary resources to bail out the banking system or stimulate demand to the same extent as in 2008/09. Although developing countries have some maneuverability on the monetary side,they could be forced to pro-cyclically cut spending – especially if financing for fiscal deficits dries up.

Well, hell. You know what Bobby Lounge says, don’t you? “Get out the tick spray, baby, don’t pity me.”

I’m beginning to think that there’s no sorrow in this world that Bobby Lounge doesn’t have the balm for. That’s my theory today. This may change. Probably not by sundown, though.