This is perhaps the best of all the charts that show the economy bouncing off the bottom. Although the ISM manufacturing index still reflects contraction, there is a lot less of it. As this chart suggests, we're likely to see second quarter GDP growth that is only modestly negative. It's not a stretch to say that the recession could end before mid-year, which happens to have been my forecast in late December.
Friday, May 1, 2009
Recession end in sight
This is perhaps the best of all the charts that show the economy bouncing off the bottom. Although the ISM manufacturing index still reflects contraction, there is a lot less of it. As this chart suggests, we're likely to see second quarter GDP growth that is only modestly negative. It's not a stretch to say that the recession could end before mid-year, which happens to have been my forecast in late December.
Scott,
ReplyDeleteYour outlook the past few months remind me of Kipling:
"If you can keep your head when all about you
Are losing theirs.."
Scott-
ReplyDeleteI said it before, your call, and the same call made by Wesbury, for a v-shaped recovery, could well turn out to be one of the best calls of all-time.
I've got my fingers crossed. Not sure how steep the right hand side of the V will be, however. That's going to be the focus going forward. If it weren't for disastrous fiscal policy, it would be a sharply upward sloping V.
ReplyDeleteScott-
ReplyDeleteIndeed, but what has been important of late is the "angle", we can worry about the right leg of the V in time...
Cheers.
As I've said before, this is a textbook repeat of the Panic of 1907. Names have changed, but the pattern is the same.
ReplyDeleteIt will be a strong recovery but the right side slope will not be a sharp v but a 45 degree angle or so.
A great rest of 2009, a fairly good 2010, and then be much more careful toward the end of 2010 into 2011.
Your concerns are certainly justified, as 2010-11 is when tax burdens appear destined to increase appreciably.
ReplyDeleteThanks guys financial trouble in 2110 is an important consideration in retirement planning. More critical though is to help people understand O'Foolery spending before the 2110 congressional elections. If conservatives gain ground I will continue to leave my money in the state teachers retirement of Ohio and go for another year. If not I want to be in Gold ETF's
ReplyDelete