Economic Insights – February 2013

In spite of bad fiscal policy and an abysmal "labor participation rate," the U.S. economy continues to muddle through. Real GDP grew 2 percent in 2011, and despite a farm drought and Super Storm Sandy, it was nearly the same for 2012.

For 2013, we expect slightly faster real GDP growth of about 2.75 percent. And some of that apparent strengthening will be due to replenishment of farm inventories after the drought, as well as rebuilding from Sandy; both factors are temporary.

Monetary policy is loose and there is a natural, free-.....