If the article below does not prove that the economists are no better than clowns in forecasting future events, nothing else will. I don’t know why the profession exists, but I guess someone must get paid for taking past events and forecasting them into perpetuity. If you have wondered why 99.5% of the economists, including Bernanke, Greenspan and Yellen missed the 2000, 2007 and the rest of the bubbles, wonder no more.
In the past I used to think that they really know, but for one reason or another, mislead the public into believing that everything is fine. However, after watching them in action for some time, I am really beginning to think that they believe in their interpretation of reality and their “lets print our way to prosperity” approach. Making them not only reckless, but pretty damn stupid.
Based on the survey, the economy is about to accelerate because the weather is getting better, the emerging markets distress is over, the stock market correction is over, the unemployment rate is collapsing, corporations are hiring by the millions and only sunshine and flowers are on the horizon. Yet, you know better dear reader.
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Economists: U.S. will see better growth in ’14
Despite some disappointing economic news recently, economists surveyed by USA TODAY expect the recovery to accelerate this year.
The U.S. economy is headed for stronger growth in 2014 that will steadily chip away at the unemployment rate, top economists predict in a largely optimistic USA TODAY quarterly survey.
The jobless rate, which dipped to a five-year low of 6.6% in January, will fall to 6.3% by the end of the year, their median forecast indicates.
Job gains, which averaged 194,000 a month last year, will reach a monthly average of 200,000 this year, they predict. Employers added 113,000 jobs in January, well under many economists’ forecasts, the government reported last week.
The economy got off to a slow start in January as a result of financial turmoil in emerging markets, a stomach-churning drop in stock prices and extreme winter weather that kept many shoppers at home. But the economists surveyed expect growth to accelerate after a weak first quarter, reaching a solid 2.8% rate for the year.
“I think we will regain momentum and not fall on our face,” says Diane Swonk, chief economist of Mesirow Financial, drawing a contrast with previous ups and downs in the five-year-old recovery.
Many of the 40 economists surveyed Feb 5-6 recently cut their first-quarter forecasts. Most of the change is due to the adverse January weather and an expected pull-back in business stockpiling after firms aggressively replenished shelves in the second half of 2013.
While growth late last year was driven largely by the stockpiling, this year’s expansion will be fueled by higher consumer and business spending, says Dean Maki, chief U.S. economist of Barclays Capital.
“It’s more durable,” he says.
Many were anticipating a breakout year in 2014, signaling a new course for a generally sluggish recovery. Households have shed much of the debt they amassed during the mid-2000s real estate bubble. A stock run-up and rising home prices have made consumers feel wealthier. And the effects of federal spending cuts and tax increases are fading, while state and local governments are poised to increase outlays after years of austerity.
Several economists say those improving fundamentals remain intact. Some see financial troubles in emerging markets such as Turkey and Brazil as risks to the USA’s outlook. Chris Varvares of Macroeconomic Advisers has trimmed his growth forecast, saying the turmoil could curtail U.S. exports and stock prices, crimping business investment and consumer spending.
But more than eight in 10 of those surveyed said January’s stock sell-off and emerging markets’ woes have not caused them to be less optimistic about growth this year. Sixty-four percent said their 2014 forecasts are more likely to prove too conservative than too rosy.
Maki says the recent stock swoon pales compared to last year’s market gains and is unlikely to hurt consumer spending this year. Rising interest rates may cause Americans to buy smaller homes, but they shouldn’t deter purchases, he says.
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Economic Survey Proves, Most Economists Are Worthless Google