The economy is showing clear signs of a recovery, but
what will that recovery look like and what dangers lie
ahead?
Why the optimism?
Most of the recent optimism began with the release of recent
unemployment and GDP numbers which were better
than expected, and much better than in the preceding reports.
At the same time, the stock market has risen to its
highest point in several months. Finally, the housing market
is showing signs of recovery to varying degrees in most
regions and price ranges.
Is the optimism justified?
Generally speaking, jobless rates and GDP are not the best
indicators for measuring the real-time health of an economy.
GDP numbers take months to be accurately calculated,
rendering them somewhat obsolete by the time they
are viewable. Jobless rates are sometimes described as a
"lagging indicator," because they are usually the last thing
to respond to economic change. However, stock market
gains and increased activity in the housing market suggest
that the recovery is legitimate.
How long until we're back to normal?
Most analysts are quick to warn that although things are
less bad than they have been in months past, they are still
not good. For instance, the most recent reports still show
our GDP shrinking. In a healthy economy, the GDP would
be rising. On the other hand, it is possible that the economy
has already begun its long, slow ascent towards sustained
growth--a fact that may not be confirmed until the next
GDP report.
Article by www.WrightBrosComm.com