(Bloomberg) -- The global economy is not on the brink of going bust, yet the risks are mounting and politics is the big threat.

That was the bottom line of a week spent among policy makers, investors and corporate executives at the World Economic Forum’s annual meeting in Davos, Switzerland.

“There’s always a lot of winds, but it seems to be more than average,” said JPMorgan Chase Chief Executive Officer Jamie Dimon. According to Rob Shuter, CEO of wireless carrier MTN, “people are subdued. The world is very unstable at the moment and there is no consensus on how the things affecting sentiment will play out.”

Here are the headlines as the global elite leave the Alps:

SLOWING NOT SLUMPING

There was cautious optimism that the global economy is not facing recession. The International Monetary Fund set the tone by cutting its growth forecast this year to a still fairly solid 3.5 percent. “Last year at this point in time people were almost too bullish,” Deutsche Bank CEO Christian Sewing said. “Now when I talk to people they are almost too cautious.” As for what that means for central banks, most urged them to be patient in raising interest rates although Wall Street bosses see further hikes from the Federal Reserve.

Read More:

  • Global Recession Not Seen in Davos Even as World Economy Slows
  • U.S. Bank CEOs See Fed Still Hiking After Market Chaos
  • IMF Sees Weakest World Growth in Three Years as Europe Slows

TRADE WAR WORRIES

The trade wars were unsurprisingly the main source of stress. “Part of the uncertainty and instability that we have right now is that what happens between the U.S. and China is so significant to economic growth,” said Carlos Pascual of IHS Markit. Whether or not a deal is reached was a major subject of discussion. Also worrying executives was whether the related declines in business confidence and investment could alter the long-term path of global growth.

Read More:

  • China Joins Talks to Strike a Worldwide Digital Trade Agreement
  • Tech Optimism at Davos Tempered by Trade Anxiety and Regulation

CHINA CRISIS?

Some were more worried by the outlook for China. “The biggest story in the global economy at the moment is the Chinese slowdown,” said Adair Turner, chairman of the Institute for New Economic Thinking. Taking a bullish stance after the weakest annual expansion since 1990, Vice President Wang Qishan predicted “sustainable” growth. Business leaders used a private meeting with Chinese regulators to air concerns about how the economy is managed, while one official said more licenses for foreign banks to work in China may soon be issued.

Read More:

  • Chinese Vice President Pledges Continued, Sustainable 2019 Growth
  • Soros Warns China Uses Algos to Find Threats to One-Party Rule
  • Top Business Leaders Use Davos Dinner to Air China Grievances

IT’S POLITICS, STUPID

It’s not just trade. Credit Suisse CEO Tidjane Thiam called politics the biggest risk for 2019 amid mounting populism. The U.S. government shutdown is having a “big impact on the economy,” said David Rubenstein of the Carlyle Group. Italy got admonished by European policy makers for its anti-EU rhetoric: “Changing Europe is one thing, destroying Europe is another thing,” said EU Commissioner Pierre Moscovici. As for Brexit, Chancellor of the Exchequer Philip Hammond saw a “very real” risk of it happening without a deal.

Read More:

  • U.S. Shutdown Dominates Wall Street Chatter at Davos
  • Italy Gets a Slapdown at Davos From European Union Partners
  • Ocasio-Cortez Buzz Hits Davos With Talk of 70% Tax-Rate Plan

NEW WORLD ORDER

With President Donald Trump absent, the world circled the wagons against his attacks on the international order. “A global architecture will only work if we’re capable of compromise,” said German Chancellor Angela Merkel. But Secretary of State Michael Pompeo cheered disruptions taking place as a “positive development.”

Read More:

  • Davos Elites Rush to Barricades to Defend International Order
  • Bolsonaro Says Brazil Must Reform or Become Next Venezuela
  • Wall Street Embraces Saudi Bid for Rehabilitation at Davos

TOO MANY BANKS?

European banks came under pressure to consolidate. With scale everything, UBS Chairman Axel Weber said mergers are needed although he cautioned that obstacles remain in a region still fragmented along national borders. “In the end there’s always a nationalist pride of having a national champion or a series of national champions,” said Citigroup CEO Michael Corbat. Bank of America chief Brian Moynihan predicted more deals in the U.S. like the one that created his firm. The good news is most present felt banks are in better shape to fight the next crisis.

READ MORE:

  • Davos Elite’s Call for Europe Bank Deals Grows Louder a Year On
  • BofA’s Moynihan Predicts Another Round of U.S. Bank Mergers
  • Carney Says Jail for Bankers a Bluff, Hitting Pay Best

WITHER GLOBALIZATION?

This year’s annual meeting was ostensibly about “Globalization 4.0,” or what many see as a new digital wave in which data and services increasingly replace physical goods. But delegates still appeared perplexed about how to deal with a political backlash against globalization in wealthy countries. “When people say globalization is not benefiting us they are often telling the truth,” said Oxford University’s Ian Goldin. And yet, the reality is that in many developing nations “the problem might be too little.” In many cases dealing with differences requires global coalitions made harder by an American retreat from its traditional leadership role.

Read More:

  • Davos 2019 Is All About ‘Globalization 4.0.’ So What is That?
  • What Crisis? Fortunes of Davos Billionaires Surge Since 2009

--With assistance from Yoko Shimizu, Victoria Cochrane, Alexander Frangeskides, Oliver Crook, Elena Gergen-Constantine, Harris Braude, Adrienne Toscano, Laura Chapman, Branden Asemah, Jared Sinclair, Francine Lacqua, Tom Keene, Haslinda Amin, Jonathan Ferro, John Micklethwait, Stephanie Flanders, Brad Stone, Javier Blas, Jacqueline Simmons, Ambereen Choudhury, Chad Thomas, Shawn Donnan, Steven Arons, Jessica Shankleman, Ruth David, Sridhar Natarajan, Jun Luo, Eric Martin, John Follain, Erik Schatzker, Charlie Lait and Kurumi Mori.

To contact Bloomberg News staff for this story: Simon Kennedy in London at skennedy4@bloomberg.net

To contact the editors responsible for this story: Simon Kennedy at skennedy4@bloomberg.net, Fergal O'Brien, Zoe Schneeweiss

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