Where We Are?

Via Pension Pulse.

My last comment on economic hypochondria generated a great deal of anger on Zero Hedge where the comments got nasty, so I want to address some of the valid criticism.

Mr. Wesbury's assertion that the economy is "fine" is ridiculous, and I
did edit my post to bluntly state this. When the official unemployment
rate stands close to 10% and wider measures of unemployment are almost
twice that figure, things aren't "fine".

But I agree with Mr. Wesbury that
far too many people have taken gloom & doom views to the extreme,
and that the US economy might be in better shape than these people are
willing to admit.

Last week, the Liscio Report posted an interesting comment on their blog, Where we are?:

Here’s
an updated guide to “where we are”—how the U.S. economy is faring
relative to the average of previous financial crises around the world.
Though individual details vary, we’re following the script pretty well.

In
the graphs of four major indicators (click on chart above), the lines
marked “average” are the averages of fifteen financial crises in
thirteen rich countries since the early 1970s, as identified by the
IMF. GDP isn’t shown because the experiences were so varied that the
averages were meaningless. But for the indicators shown, the averages
do illustrate some tendencies worth taking seriously.

Employment
Though
the U.S. peaked later and bottomed earlier than the average, and also
rose higher and fell harder, the trajectories of the two lines are
still remarkably similar. Note that after hitting bottom, employment in
the average experience grew very slowly. If we’re in for anything like
that average, then we’re likely to see employment growth of only about
35,000 a month over the next year—less than a third what’s necessary
just to accommodate population growth. That suggests that we could see
an unemployment north of 10% in about a year.

CPI
Given
the gyrations in energy prices over the last couple of years, reading
the headline CPI has been very difficult. But the gyration does seem to
be around the average line. And core CPI—for which we don’t have
international data—is tracking the average pretty tightly. If inflation
follows the script, it should continue to decline into next year. With
core inflation at around 1%, it’s reasonable to expect that we could
go into mild deflation sometime over the next few quarters.

Interest Rates
Rates
on 10-year Treasury bonds have fallen harder in the U.S. than in other
crisis-afflicted countries, but the trend is typically down for almost
four years after the onset of crisis. Further declines in U.S. rates
seem like a stretch, but the likelihood of an upward spike looks
remote.

Stocks
Stocks fell much harder in
the U.S. than they did in the wake of the average financial crisis,
though they did enjoy five quarters of nice recovery. As with interest
rates, further declines seem unlikely; in fact, the average increase
from here would be around 7% over the next year.

So, all in
all, we’re getting pretty much what we might expect out of our major
economic and financial variables: a weak, choppy recovery with a
deflationary undertow.

I think this is a fair and
balanced comment, but again, it's a very US-centric view of the world.
If you factor in robust growth from emerging economies, central bank
intervention and the extraordinary liquidity in financial markets, the
path to recovery might surprise the staunchest naysayers.

Finally, it's Sunday, and I'll leave you with some food for thought from George Friedman, CEO of STRATFOR,
who believes China “will collapse” in the coming decade and that
America will be the primary beneficiary. Mr. Friedman's views are
controversial but well worth listening to.

Comments

[Hulk]

prof horne, stanford

http://www.youtube.com/watch?v=KTsYjRqPmNA

[qrs521]

Women in summer would like to become beautiful. Everything can grab other's eyes is their best friends.Products make them beauty and confident is their favourite. Look in the street,you can see many different types of make up to show women's personality.

Welcome to the shop, the following is our products, free shipping.

Soccer Shoes Cheap Soccer Shoes Nike Soccer Shoes Adidas Soccer Shoes Nike Soccer Shoes sale Adidas Soccer Shoes sale UGG UGGs UGG Boot UGG Boots UGG Boots Sale Cheap UGG Boots UGG Boots Cheap Women UGG boots ugg boots cardy ugg cardy boots Timberland Timberland sale Timberland boots Timberland boots online Timberland on sale New timberland boots UGG UGG boots UGG boots sale UGG boots short Short ugg Short ugg boots Ugg boots tall Nike Air Nike Air Max Nike Air Max Shoes Nike SB Nike Dunk Nike Dunk SB Nike Dunk SB Shoes Nike Shox Nike Shox Shoes Women Bags Women Bags Sale Women Handbags Women Handbags Sale Women New Bags Cheap Bags Cheap Bags On Sale New women bags New women bags sale New women bags sale online Louis Vuitton Handbags Gucci bags Nike Nike Shoes Nike Shoes Sale Nike running Nike running shoes Nike trainers Nike trainers shoes Timberland Timberland boots Timberland boots sale Timberland boot Timberland boot sale Timberland boots cheap Men timberlands MBT MBT Shoes MBT Chapa GTX MBT Men Shoes MBT Women Shoes Discount MBT Shoes LV Handbags Gucci Handbags Chanel Handbags Chloe Handbags D&G Handbags Dior Handbags Fendi Handbags Hermes Handbags Jimmy Choo Bags Marc Jacobs Bags Miu Miu Handbags Mulberry Bags Prada Handbags Versace Handbags Yves Saint Laurent Balenciaga Bags Burberry Handbags LV Handbags Gucci Handbags Chanel Handbags Chloe Handbags D&G Handbags Dior Handbags Fendi Handbags Hermes Handbags Jimmy Choo Bags Marc Jacobs Bags Miu Miu Handbags Mulberry Bags Prada Handbags Versace Handbags Yves Saint Laurent Balenciaga Bags Burberry Handbags

Those who want to become most beautiful in the world should try them. Just ones can make you different. Girls who want to grab your boyfriends's heart is necessary to use them.

[Bluntly Put]

Don't worry about that debt overhang folks, financial engineering having replaced traditional economic fundamentals such as production has gotten us into this mess, it can surely get us out. Right?

[Dollar Bill Hiccup]

George Friedman is interesting because his views are Strategic -- which is a refreshing change from the excruciatingly short sightedness that we seem to be engrossed in. ADD political thinking ... hey is that a penny?  

His book, "The Next 100 Years" is a quick read, interesting stuff given twin analytical pillars of history and geography.  You don't have to agree, but simply engaging a longer time horizon that is fostered by historical context is as I said above, refreshing  ...

[Careless Whisper]

oh puhleeze, send him back to the u.s. army war college or the rand corp.