Im in for ali velshi and this is real money. Changing fortunes make out winners and losers in the Global Economy. For the First Time Since the recession, the United States is poised to be the engine of Global Growth not china, not emerging markets. The u. S. Economy is expected to grow 3. 1 this year the labor market is picking up steam, and weve seen a small but significant uptick in u. S. Wages. Meanwhile, chinas spectacular growth story is not such a page turner anymore with many expecting the economy to grow roughly 7 this year. Thats still a lot higher than the u. S. And its a far cry from the doubledigit growth china has seen in recent years. The european union, well, its just plain stagnating. 1. 8 Economic Growth is forecast for the eu this year. In response the European Central bank chief said today hes ready to spend loads of cash to stimulate eu economies. That sent the dollar soaring against the euro to the highest level in five years, and the dollar is strengthening against other currencies. A 50 drop in oil prices is partly to blame, already the price drop is making losers out of oilproducing regions the world over from russia to iran and from texas to north dakota too. Even so falling prices at the pump make winners out of u. S. Consumers, but the stronger dollar will make losers of u. S. Exporters as their products become more expensive to buy overseas. While the slowdown . In exports hurt american manufacturers it wont hurt the Global Economy. Jay bryson joins us from charlotte, north carolina. Jay, great to have you back on the show. Lets start with the focus on the u. S. Is the boost from Consumer Spending we expect to get from lower gas prices will that offset weaknesses we might see as a result of the strong dollar . Yeah it should. I mean keep in mind that you know, Consumer Spending is twothirds of the u. S. Economy, exports is only 10 . Even if Consumer Spending grows just a little bit and exports really weaken still given the size of Consumer Spending it should offset the drag from exports. Lets broaden out the global picture, jay. Whats your outlook for china this year . Well so we think china in 2014 grew somewhere around 7. 5 . We think thats going to probably slow to something 7 maybe a little bit below that. As you look into 2016 slower at 6. 5 . Thats slow by chinese standards. 6 to 7 growth is there. How do you see that rippling out through the Global Economy . Well you know so if you look at some of chinas main trading partners in asia Slower Growth in china is going to affect those economies as well. When you add everything up and you look at how big is the United States relative to china and what effect does it have on the Global Economy, the best way to measure these things shows that china is really up only 50 of the size or importance i should say in terms of the Global Economy. So a slower china certainly, you know, is not good for the Global Economy but as long as china doesnt completely implode, which we dont think it will happen the overall Global Economy should be okay in 2015. Lets circle west and put the focus on europe. We have low inflation and some European Countries in the grips of deflation. Can they escape this . Well its going to be very very slow for them to do that. If you think of our economy, if you think of all the stimulus that the Federal Reserve implemented here in the United States its five years of relatively slow growth five years of very low inflation, europe is just starting to get along with this. Its going to be a while yet before europe really starts to pick up some steam. Do you think a Quantitative Easing Program in europe will help to boost the price points a little bit, or do you think that theyre in for another year another two years, another three years of pain . Whats your outlook . Well you know two or three years i dont know if its necessarily pain but were looking at two or three years of relatively slow growth. Quantitative easing on the margin here helped but its not the silver bullet. Just because the ecb starts to buy government bonds, and that certainly is the expectation, it does not mean europe will go ahead this year. A slow europe for the next few years. This is a Global Economy, but up expect want u. S. To remain somewhat insulated from the head winds. Why is that . Well so if you look at the overall u. S. Economy, you think about it what is it . Its largely a servicebased economy. Services just arent traded all that very much. So you think of some of the bigger sectors in the economy. Start with health care. How much is that affected by growth in the rest of the world . Zero. Education. How much is that affected by growth in the rest of the world . Zero. Construction, very little. If you look at the big sectors in the u. S. Economy, they dont have a lot of ties with the rest of the world. So a real significant slowdown or downturn in the rest of the world would certainly hurt but if were talking about slower Global Growth it doesnt cause the u. S. Economy to go back into recession. Final question, jay and, of course, this is the one so important to many viewers, and that is wages. Weve seen a slight uptick in the last employment report. Do you think this could be the year when u. S. Workers start to see meaningful increase in their paychecks . I think it potentially could. Keep in mind whats important at the end of the day is not necessarily, you know, what you see in your paycheck but its adjusted for prices and adjusted for inflation. Its purchasing power, okay . What we do believe we will see this year is some acceleration in nominal wages, but inflation should be low. Look at gasoline prices. Theyre down 40 , 50 over the last few months. That puts extra purchasing power in peoples pockets, and so you know, at the end of the day thats important here. So we do believe that real purchasing power will be stronger in 2015 than last year. Okay. Well, heres hoping that those predictions come true. Jay bryson from wells fargo, thank you for joining us. We really appreciate it. Well American Consumers probably love plunging oil prices and the lower gasoline prices along with them but countries that rely on oil to drive their economies are feeling economic pain right now. We have a look coming up. Youre watching real money. Only on Al Jazeera America oil prices have fallen some 50 sin peaking in late june thanks to part to upstart u. S. Shale producers flooding the market with new supply when Global Demand is ebbing. That swing of the price pendulum brought relief to consumers at the pumps while heaping pain on countries like russia venezuela and iran. They need oil to fetch 100 or more a barrel to fund the state budgets. From caracas to tehran to moscow couldnts that count on High Oil Prices are realing. The whole atmosphere can change drastically whether prices come down. The crude prices went down after they failed to cut down production, a tactic to protect riyad. The ones that need high prices are the iranians and the venezuelans who need 120. Nonopec Oil Producers are in the cross hairs including russia already realing from sanctions and high inflation, moscow was counting on 100 a barrel to fund the putting. Price pressures are building in north america where states that reap the windfall of the fracking boom are poised for lower tax revenues and fewer new jobs as drilling new wells becomes less profitable. White producers in governments that have grown fat off Expensive Oil are in for some belt tightening falling prices should cut others some muchneeded slack. Such is india and other developing countries that depend heavily on agriculture which consumes vast amounts of oil through inputs like fertilizer and pesticide production. In countries like the United States where people rely heavily on cars consumers are benefits from lower prices at the pump. But the big erwingest winner of all could be the Global Economy, as falling fuel and transport costs move money away from Oil Producers into consumers pockets provided they spend the extra cash. Earlier this week i talked to steve levine washington correspondent for the online news site quartz. He says oil will continue to drive a list of winners and losers on a global scale in 2015. Weve already noted u. S. Consumers are winning at pumps. I asked steve if its the same for global consumers. Well theres a little less glee abroad. Theres some. The difference is our low gasoline taxes. So diesel prices european drivers most of them use diesel for their cars. Diesel prices have dropped in europe, too. Gasoline prices around the world, dice sell diesel prices, all consumer countries are doing very well. What about agricultural based economy, india, for example. Does that help the economy in terms of lowering the price of diesel whiches a big input in agriculture . Yes. India, indonesia, turkey these especially are countries that import a lot of fuel used in a lot of industrial and agricultural activities and so theyre doing very, very well and, in fact, one thing that the governments are doing in some of these countries because of these low prices, thaf been able to withdraw subsidies. So its a boon for the general economies, too, when the prices go back up those states will be much better put. Theyll have to put much less money from the public coffers into subsidies. Lets take a look at losers of course. We look at countries that rely very, very heavily on export hef news from oil. We have russia which was counting on 100 a barrel of Oil Next Year and iran needs 140 a barrel and venezuela is another big loser. When you look at those countries that depend so heavily on oil exports, which one do you think is poised to be the biggest loser in 2015 . Venezuela. So its not it has to double or triplewham krimytriplewhammy. Its not just that oil prices are low and that the market is so glutted that theres a lot less nand for venezuelan oil, but its by far the worst run petro state in the world. So, you know a lot of people believe that venezuela is headed for a default next year. The market the bond market puts the chance of a venezuelan default at over 90 . The other states russia is in a really bad situation, so its got its companies and banks that have tens of billions of dollars of debt payments coming up next year. Usually these bonds are rolled over through carryover loans from the same banks or for other banks, but european and u. S. Banks, russia debt is off limits. Where do these russian entities turn to to roll over their debts . The russian government has putin has promised he will cover the debts, but that means that the reserves the russian reserves, 250 billion are going to be drawn down. The longer that sanctions remain the worse the fiscal and monetary situation is going to be there, too. What about saudi arabia . This is an interesting case. Of course, saudi arabia is having to move into its cash reserves, of course, to cover the shortfalls on the price of oil. They really have shown that they are a player that theyre relevant and really flexing their muscle by refusing to cut out output to buoy prices. Where do you put saudi arabia on the winners losers scale . Theyre potentially you have to look at it as an investment. Saudi arabia is betting that it can turn it can turn out the winner two, three, four five years down the road by keeping market share and forcing competitors out of the market and the competitors being primarying the United States but also brazil canada and some other states countries that are coming into the market and make remake saudi arabia and opec as the central player in global oil. With oil having dropped by 50 , Oil Prices Since june that means that next year it will earn 150 billion less than it has on average the last three years. Now, the saudis are very casual. Theyre saying were indifferent to this. Were just going to wait. We have 750 billion in the bank. 150 billion less thats a lot of money. If that goes on year after year if it goes on five years that wipes out the whole 750. So i think that the saudis are putting on a game face but they believe the consensus that oil prices are going to turn back up the second half of next year back into 2016 so that this bet is going to pay off soon. I have my doubts. Other players i think are very very compelling whether they say we have these kind of oil prices meaning between 60 and 70 a barrel through the end of the decade. Steve levine, thank you so much for joining us. We appreciate it. Thank you. Russian president Vladimir Putin is certainly feeling the pain of falling oil prices. Well tell you how dwindling oil revenues could undermine putins leverage in the new cold war with the west. That and more after the break. Stories that impact the world, affect the nation and touch your life. Im back. Im not going anywhere this time. Only on Al Jazeera America. The death toll could be much higher than anyone known. Posing as a buyer. People ready then. Mr. President who should answer for those people [[vo]] an america tonight indepth series. My first column was, hey, where are the weedsmoking moms at . [[vo]] one year legal. Id try chem 4, alien dog, and girl scout cookies. [[vo]] and its become big business. The state of colorado is profiting immensely off of this. [[vo]] now, we cut through the smoke and find out whats really going on. We can show marijuana is leaving colorado. [[vo]] the highs and lows of a year on pot. Falling oil prices is another reason theyre on shaking economic footing. The annual pay rate skyrocketed to 11. 7 last year prompting Russias Central Bank to hike the Interest Rate to a dproetchilling 17 . At the beginning of march last year it stood at 5. 5 . Imagine seeing your Adjustable Rate Mortgage more than double in a year. The loss of confidence has triggered a wave of capital flight from russia estimated at some 128 billion. Some companies are running into trouble servicing russias corporate debt which shot up to 550 billion in 2014. All that pain gives the kremlin very little room to maneuver as western sanctions start to bite especially those blocking key firms tied to russian president Vladimir Putins regime from refinancing debt redominated in dollars. Its engineered what amounts to a pail jot of state energy giant. Russia does have a healthy foreign reserve fund to help weather the hard times, but whether you break it down that Rainy Day Fund may not be as robust as it appears. 388. 5 billion in foreign reserves, the cushion thats meant to see russia through its harshest economic climate since its 1998 debt default, but how long can that Rainy Day Fund hold out . You can run the math and it doesnt last forever. Russia has taken a 120 billion bite out of the reserves in the last year blowing the lions share some 80 billion on defending the rouble. Not all of the 388 billion left is easily tapped. 45 billion of russias reserves are held in gold while another 12 billion is timed up with the imf mostly in noncash instruments. Russia also counts roughly 170 billion in its kovrn wealth funds as reserves including the National Wealth fund meant to cover a shortfall in state pensions. Its not clear how liquid the assets in that fund are. So probably they should be discounted a bit. Deduct these potentially illiquid turms and the cushion doesnt look as plump, sobering because oil could fall further and firms targeted by sanctions cant refinance tens of billions of dollars worth of debt coming due this year. Our next guest believes russia is headed toward a systemic crisis and very few people including russian president Vladimir Putin truly appreciate how the economic woes place so many elements of his rule under strain. Mike is professor of Global Affairs at new york university. Thank you for joining us. Lets start with putins grip on power. How is it going into the year . Its pretty much unchallenged on the the moment. Theres no opposition movement. A few thousand in moscow doesnt count, and theres no real alternative candidates for power. Theres no alternative ways to bleed out the tension within a system. Youre for putin or against him. As normal pressures arise they have to think is putin really the guy we want in power . Did the relet still see him as their protector, if you will . Yes, but its a very, very pragmatic move. 2015 was anyway before the sanctions a tough year for the economic, and everything coming down to the economy. Thats how putin is in charge. He dispenses large bailouts and the opportunities to embezzle for massive value. As the cape beginning to shrink everyone starts to compete to hold onto their slice of the cake. Up to this point, times have been good, so putin can buy everyone off. Now he has to make smart decisions. Who does he support and not support. Some people think, hang on a minute. Last year you were my protector, putin putin, and now youre not. What else do i do . Lets talk about those tough decisions, because, of course so many aspects of the popularity and rule rest on making russia great again. We think about military spending. Is he going to cut there . Is he going to cut off money to the provinces, social spending . Where is he likely to cut in your view . Hes already begun to cut. Weve seen most govern