Lakshman Achuthan has someone to take the other side of his recession bet. Unfortunately for him, it’s no lightweight. One of the global economy’s best barometer’s of growth is now saying there will be no recession (despite their recent dip in earnings and cautious outlook). CNBC reports:
“We don’t see a contraction; we don’t see a recession,” FedEx’s Smith said at a meeting in Columbus, Ohio, where General Electric unveiled research on midsized companies.
“It’s steady as you go, slow growth,” Smith said. “Not contraction.”
I still think the whole double dip debate misses the point and takes the focus off of the true cause of this recession. We have been in a classic balance sheet recession this entire time. There was no recovery. There was only massive government stimulus that papered over the weakness in the consumer who has been de-leveraging. The key from here will be understanding the impact of any potential deficit reduction between now and 2013 (when I believe the BSR could be over) and also keeping an eye on exogenous shocks as they could turn slow growth into negative growth.
Read Some Related Articles on Pragmatic Capitalism -
2 Bullish Macro Indicators
Sometimes it's easiest to understand the big picture with the simplest indicators. And two of the more trust ones in the macro arsenal are the PMI reports and the weekly ...read more
Q&A - Ask Me Anything
Since I am trying out the site without comments I figure the least I can do is open things up to a Q&A more often. Feel free to have at ...read more
There Isn't $10.8 Trillion "Stuffed Under Mattresses" Because of QE
I have to comment on this MarketWatch piece because I've now seen a number of people comment on it claiming that consumers are choosing to hold more low interest bearing ...read more
Rail Traffic Keeps on Chugging Along
Intermodal rail traffic posted a 5.4% gain in the most recent week bringing the 12 week moving average down to 6.1%. That is a strong reading, but also a 3 ...read more