Categorie: Recreation
Submitted 5 months ago by
Jmauldin
, Outside the Box
at Millennium Wave Investments
The Muddle Through Economy:The Future of the Market and Your InvestmentsIt is increasingly widely agreed that we are now in a recession as I predicted this time last year. The good news is that much of the underlying economy is not in that bad a shape, but it has had two serious body blows administered by the twin collapsing bubbles of the housing market and the credit crisis. My position is that the recession will be rather long and relatively shallow, and the inevitable recovery will be longer and more drawn out than is typical, resulting in what I call The Muddle Through Economy for a period of several years. I define a Muddle Through Economy as one which grows below normal trend GDP growth of 3% for a period of time, typically in the 2% range. So, one of the key questions is: "When does the recovery start and how long will it take to get back to 3% GDP?" I think the answer is that it will not be before the latter half of the year and will take at least two years to get back to trend growth. The reason for such a drawn out recovery is simple. The twin causes (housing and the credit crisis) will take at least two years and possibly longer to normalize, and that process is going to negatively effect several other sectors of the economy. But then I am an optimist. Duke University released a survey yesterday of Chief Financial Officers of major corporations. This is a gloomy bunch. 54% think...
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Submitted 5 months ago by
Jmauldin
, Outside the Box
at Millennium Wave Investments
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