New Year, Same Problems

When making an economic forecast, I always consider the various scenarios that can unfold, each dependent on a myriad of variables. Every scenario has a certain probability associated with it. And one must consider the catalysts that serve as an impetus for any given scenario -- the how and why of a particular situation. With that in mind, I begin my outlook for 2012.

The first consideration is where we are now. Economic data came in a bit better than expected earlier in the fourth quarter, with improving small-business optimism and signs of health in regional manufacturing surveys. While these are reasons for optimism, they are only surveys and not hard data measured in dollars or output. Actual data on investment and spending released at the end of December demonstrated an economy lacking forward momentum. What are the reasons that the economy might be propelled forward? Conversely, what are the risks that can cause its engine to sputter further?...689 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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