Economic Insights – November 2011

As we predicted this time last year, the U.S. economy is continuing to “muddle through,” in spite of horrendously bad fiscal policy.  It barely showed a pulse in the first quarter, with real GDP growth of 0.4 percent, then sputtered in the second quarter to deliver 1.3 percent real growth.  And that was all the evidence the “conventional wisdom” needed to be convinced that a recession was on its way. We argued that since real gross domestic income, or GDI, with a reading of 2.4 percent growth, diverged so sharply from real GDP at just 0.4 percent in the first quarter, that the GDP would event.....