Only a few months ago, some economists still offered hope that robust expansion could continue in much of the world even as the U.S. economy slowed. Foreign investment was expected to keep replenishing American banks still bleeding from their disastrous bets on real estate and to provide money for companies looking to expand. Overseas demand for American goods and services was supposed to continue compensating for waning demand in the States.

Now, high energy prices and the decline of trading partners have combined to choke growth in many major economies. The International Monetary Fund expects global growth to slow significantly through the end of this year, dipping to 4.1 percent from 5 percent in 2007.

"The global economy is in a tough spot, caught between sharply slowing demand in many advanced economies and rising inflation everywhere," the IMF declared last month in its official World Economic Outlook.

All this means that economic troubles in the United States could intensify beyond the presidential election season. It could also make it harder for financial companies like Lehman Brothers, which has been seeking fresh investment in South Korea, and the government-backed mortgage giants Fannie Mae and Freddie Mac to attract needed capital from abroad.

As the United States and many other large economies slip in unison, the reality of integrated markets is being underscored: Just as globalization spreads prosperity, linking cotton farmers in Texas to textile mills in China, the same forces spread hurt when times go bad. "The slowdown has reached such a wide range of countries that they're now feeding on one another," said Alan Ruskin, chief international strategist at RBS Greenwich Capital.

The impact of the downturn is reflected by the experience of the Vermeer Corp. in Pella, Iowa. The company, which manufactures farming and construction equipment, has become accustomed to looking abroad for growth as the real estate bust in the United States has crimped purchases of its gear by American home builders. Its overseas sales have doubled in the past five years as a percentage of its total business and now make up nearly a third of its revenue, said Steve Heap, the company's senior director of international sales.

But in recent months, even as growth has continued overall, some parts of the world have sunk into malaise.

"The UK has been really soft for the last six months," Heap said. "Western Europe overall has been flat. We've not seen the growth we've seen in the last few years."

Many other major economies are either stagnant or shrinking as well. Japan, whose fortunes are tethered to exports, saw its economy contract at a 2.4 percent annual rate from April through June after accounting for inflation. Germany, another export power, slid at a 2 percent clip. France and Italy slipped slightly.

Even China and India, whose swift growth has occasioned talk of a new global order, have been cooling in recent months, though still expanding at rates that would bring envy in nearly any other land.

"We had buoyant world growth for a few years," said William R. Cline, a senior fellow at the Peterson Institute for International Economics in Washington. "It was too hot not to cool down, as the song goes."

On the bright side ...

There is a potentially significant upside to the downturn under way: It could knock down rising prices for food and energy, which have been driven higher by swelling demand.

The chairman of the Federal Reserve, Ben Bernanke, has been betting on that very scenario as he has rejected calls for higher interest rates to suffocate inflation.

The recent drop in commodity prices, combined with "a pace of growth that is likely to fall short of potential for a time, should lead inflation to moderate later this year and next year," Bernanke said Friday at the Fed's annual economic symposium in Jackson Hole, Wyo.

Still, concern centers on the possibility that slowing global growth could hurt sales of American goods and services overseas. Exports have been a conspicuous bright spot in an economy colored by falling home prices and declining consumer spending.

The dollar has been strengthening against many currencies in recent weeks -- not because of a newfound belief in American prospects, economists say, but because investors are edging out of markets that are weakening, like Britain and other parts of Europe, sending down the pound and the euro.

A stronger dollar makes American goods more expensive on world markets. If the dollar keeps strengthening, it could pinch sales.

Economic trouble has spread far beyond the United States to major countries in Europe and Asia, threatening U.S. businesses with the loss of foreign sales and investment that have become increasingly vital.

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