Economic outlook for 2012 much better?

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Forums > All Posts > Economic outlook for 2012 much better?

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01-09-2012, 08:14 AM

Schmidt
Colorado Springs, CO
Posts: 1058

Reference: TPMDC, January 9, 2012: The Rapid Economic Recovery Republicans Are Praying Against

Brian Beutler of TPMDC has questioned the conventional wisdom that the economy will remain weak for years.

"A contrarian school of thought holds that it is wrong — and its proponents have a growing cache of evidence to back them up. If these evidence-based optimists are correct the political implications will be vast — as we all saw on Friday when a promising jobs report from the Department of Labor alighted into the political consciousness the possibility that a robust economic recovery could take hold imminently, and thus overturn a year’s worth of conventional wisdom about the trajectory of the 2012 election."

Beutler cites Karl Smith, an economist at the University of North Carolina who focuses on pent up demand: "Pent up demand overtakes people’s aversion to spending and investment, idle resources get put to use, and the country’s economic engine revs up. He just thinks we’ve reached that point now."

Smith notes two parts of the economy that are improving: rising used car sales and apartment rents: “Houses and cars are the main pieces of capital we have in the economy,” Smith says, and economic theory holds that when people finally start reaching under their mattresses to invest in them, it can set off a virtuous cycle of growth, and revitalize a weakened economy.

A point that I noted in another post was that the personal savings rate declined for much of 2011 suggesting that consumers are spending more after a three year period (2008 - 2010) of saving more. The personal saving rate has dropped from 5.2 percent in November to 3.5 percent in November.

The next key indicators will be the January and February jobs added report. If the numbers are in the 250,000 range, that's good news which could increase optimism and accelerate the recovery even further.

Any thoughts?

01-09-2012, 09:51 AM

tyler89
Not Selected
Posts: 5

Schmidt Wrote: Reference: TPMDC, January 9, 2012: The Rapid Economic Recovery Republicans Are Praying Against

Any thoughts?

Well, I pretty much agree to the report. If the number for January and February are good and peoples optimism grows further there is a fair chance that the year 2012 will be good one.

Although there are a lot of factor which could kill this hope pretty fast. A major slow in economic groth in China and India would not be helpful as well as the European Debt Crises expanding even further, or even a European Country (or major Banks) going bankrupt.
This pretty much could criple the economic upturn here instantly.

02-03-2012, 10:11 PM

CharK
Not Selected
Posts: 2

The housing market is proof that things are NOT turning around, no matter how much the numbers get spun around. An interview on TV last week with just one judge in FL stated he does 100 foreclosures a week. THAT is just ONE judge.
When is politics going to be set aside, stop the finger pointing and just get to work on a budget to balance the out of control spending before we all go down the drain.
Open your eyes Harry Reid or I will have to become Independent. PLEASE

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