Northern Trust economist Paul Kasriel put together an excellent presentation on the state of the economy (embedded below).
Here’s the bottom line:
- The recovery is off to a nice start
- The odds of a double dip are low
- The recovery will NOT be v-shaped, because consumer spending will not recover strongly (too much debt)
- The financial system is still not lending aggressively and won’t until it repairs its own balance sheets
- The unemployment rate will keep rising until the middle of next year, peaking at 10.5%
- The Fed’s “money printing” is not CURRENTLY inflationary, but it has the potential to be if the Fed doesn’t handle the recovery right
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