This would be the year when the global economy finally regained its vigor. At least that’s what many had hoped.
It didn’t happen.
The three largest economies — the United States, China and Japan — struggled again in 2012. The 17 countries that use the euro endured a third painful year in their financial crisis and slid into recession.
Emerging economies slowed.
President Barack Obama won re-election and his landmark health-care plan survived a Supreme Court review.
The tech world dueled over smartphones and tablets and saw Facebook’s initial public offering fizzle. The housing market inched toward recovery. And Americans suffered both a catastrophic drought and a superstorm.
Also, there was more investigative scrutiny on Wall Street.
The slow global economic recovery was chosen as the top business story of the year by business editors at the Associated Press.
The U.S. presidential election came in second, followed by the Supreme Court’s upholding Obama’s health-care plan.
1. The global economy: The global economy grew just 3.3 percent, down from 3.8 percent in 2011 and 5.1 percent in 2010, the International Monetary Fund estimates. Five years after a recession seized the economy and more than three years after it ended, growth in the United States was only about 2 percent. Unemployment remained a high 7.7 percent. Europe’s financial crisis did stabilize, thanks in part to the European Central Bank’s plan to buy government bonds to help countries manage their debts.
2. U.S. presidential election: Obama vaulted to a re-election victory over Republican challenger Mitt Romney, who had staked his bid on the weakest U.S. economic rebound since the Great Depression and had pledged to slash taxes.
3. Obama health-care plan upheld: The Supreme Court caught many by surprise when it backed Obama administration’s health care reform in a 5-4 vote.
The law requires Americans to buy insurance or pay a tax, while subsidizing the needy. Hospitals and health insurers will likely benefit from 30 million new customers. Medical device makers, though, will face a new sales tax. And some small businesses say the law will discourage hiring because it requires companies to provide health care once they employ more than 50.
4. The fiscal cliff: A dreaded package of tax increases and deep spending cuts to domestic and defense programs loomed over the economy in the year’s final months.
5. Facebook’s IPO: Years of anticipation led to Facebook’s initial public offering of stock — the hottest Internet IPO since Google’s in 2004. On the eve of its first trading day, Facebook’s market value was $104 billion — more than Amazon.com’s or McDonald’s at the time. Yet the IPO bombed. Within three months, Facebook’s stock had shed more than half its IPO value.
6. Housing recovery: After a six-year slump that sent more than 4 million homes into foreclosure and shrank home prices about one-third nationwide, the housing market began to recover in mid-year. Prices began rising. And builders broke ground on the most homes in four years.
Housing boosted economic growth this year for the first time since 2005.
7. The return of Big Oil: Domestic crude oil production achieved its biggest one-year gain since 1951, driven by output in North Dakota and Texas. Credit goes to drilling improvements, like those that have fed a boom in domestic natural-gas production — horizontal drilling combined with hydraulic fracturing, or fracking.
8. Banks behaving badly: JPMorgan Chase lost $6 billion in a complex series of trades. Morgan Stanley was accused of botching Facebook’s IPO. An ex-banker trashed Goldman Sachs for putting profits ahead of customers and for mocking clients as “muppets.” Barclays and UBS were fined for their roles in manipulating a key global interest rate. And HSBC agreed to pay $1.9 billion to settle charges that it enabled money laundering by Mexican drug traffickers.
9. Mother Nature: The nation suffered its worst drought since the 1950s, covering 80 percent of U.S. farmland. Grain and food prices soared. Then Sandy, a storm so destructive it was dubbed a “superstorm,” walloped the Northeast.
10. Mobile-gadget wars: Apple maintained its worldwide dominance but the use of Google’s Android software on competing smartphones and tablets spread faster than Apple’s market share.
Forty-four percent of U.S. adults own smartphones, up from about 35 percent a year ago. Tablet ownership doubled in 2012. Taking on Apple’s iPad, Microsoft unleashed its Surface tablet and began selling Windows 8, a tablet-friendly operating system. Amazon and Barnes & Noble rushed out high-definition-screen tablets. Each priced its premium model less than the entry-level iPad. Apple struck back with the iPad Mini.