Here is a very good summary of an even better paper by Lawrence H. White. And here is an interesting riposte by Brad DeLong.
I think Mr. White nailed it. Mr. DeLong's article is great food for thought, although I find it hard to evaluate many of his conclusions, since he does not provide a source for many of the numbers he uses, and others are admittedly his own estimates. One of his claims, however, namely: "We have had little or no bad news about resource constraints, technological opportunities, or political arrangements.", does not pass my smell test.
We have had those in the USA, where the most voracious consumers in the world realized that real estate prices can indeed decline; that treating your biggest and most leveraged asset - your home - as a credit card (often with a variable interest rate) may not be sustainable; and that some people - no matter what the politically correct doctrine dictates - do not make responsible home owners.
We have had those in China, where the government might finally be coming to grips with the fact that you can only build so many roads and airports that hardly anyone uses, while in the process majorly ticking off people who think they own the land you build on, and sending a lot of them in the cities to build impressive buildings - albeit occupied at 10% because of high real estate prices. Furthermore, China may be realizing that it piggybacked on the US consumer. Now, the US consumer will not turn into a Chinese saver overnight, but he/she can cut down on spending, and that translates into tens of thousands of export-oriented factories closing in China, with all the ensuing economic and social disruption.
We have had those in the OPEC countries, Canada, Australia, and Russia, where the realization might be taking place that China (and even the USA) may not continue to gobble oil, coal, industrial metals, and cement at those dizzying rates.
In a nutshell, I think Mr. DeLong is talking/writing out of experience gained in a much less globalized economy. It used to be that the wealth of the US consumer mattered some, but not too much, to many people all over the globe. These days, many governments will need to learn that if you depend on America's consumption, you will prosper disproportionately (in relative terms to your initial condition) when America does, but you will also suffer disproportionately when America catches a cold - and therefore, you might want to grow a domestic consumer class. Globalization acts as a feedback loop too - distress abroad reverberates this much more strongly at home. If I were Mr. DeLong, I'd revisit some assumptions; when a model gives you output that is garbage, only too often it turns out you have fed it garbage.
Finally, for further intellectual tittilation, look at this article by Mark Buchanan. It just may (or it may NOT) be smart to buckle up for a permanent volatility shift.