Economic Insights – January 2012

For some reason, predictions of recession or depression get an unreasonable amount of press coverage for weeks or months after the call is made.  That was especially true during the roller coaster year of 2011. Instead of the recession predicted by Nouriel Roubini and other “perma-bears,” the economy slowed early in 2011, but then picked up speed as the year progressed.  Real GDP grew just 0.3 percent at an annual rate in the first quarter, accelerated to 1.3 percent annualized growth in the second quarter, and kept accelerating to 1.8 percent in the third quarter. The consensus puts fourth quarter real GDP growth at 3.5 percent to 4.0 percent.  So, not only did the economy avoid recession, but we’re confident...

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