Had enough gloom and doom? Then consider this. The job market remains strong, not as strong as in the recent past, but strong enough to keep unemployment at low levels and to have Goldman Sachs' economists call it "robust." Productivity rose at the robust annual rate of 4.9 percent in the third quarter, causing labor costs to fall. Core inflation remains low. Most CEOs I meet are expecting profits to grow at double-digit rates in 2008. Personal incomes continue to rise. The economy did grow at a healthy pace in the third quarter. The World Economic Forum ranks America number one in competitiveness, up from sixth last year. The International Monetary Fund expects the world economy to grow at close to 5 percent, which bodes well for U.S. exports. And Ben Bernanke, while at the same time warning of downside risks to any projection, told the Joint Economic Committee late last week that "most businesses appeared to enjoy relatively good access to credit . . . the overall economy remained resilient in recent months," and that he expects growth to resume in the second half of 2008 after a "sluggish" first half, "as the effects of tighter credit and the housing correction begin to wane.
Wednesday, November 14, 2007
Beware bearers of bad news
Irwin Stelzer is supicious of the bad news coming out about the economy because those with the best information may be trying to pressure the Fed into cutting rates (from the Weekly Standard)