The Rest of The Year
The recession was devastating. All along we were expecting a “slow and uneven” recovery. Then the roadblocks kept coming and don’t seem to be stopping–from earthquakes to hurricanes. On the east coast last month we had two in the same week! So when does it all end? Well, we can’t predict Mother Nature. However, we can say that the economy is on much more solid ground than it was two years ago. Now we are not complaining about how many hundreds of thousands of jobs we are losing every month, but we are complaining about how few jobs are being created on the back end. The report released on Friday highlighted this issue with virtually no payroll growth for August, though there were several temporary factors affecting this particular report which have since been removed. Those factors included the State of Minnesota shut down, Verizon strike and federal budget negotiations.
There are three possible directions from here. One, we slip back into recession. Two, we continue to muddle our way through a painful recovery. Three, the recovery starts to pick up steam. While most are betting upon the second option, we really feel that the recovery is in position to gain traction if there no more natural disasters on the near-term horizon. Mind you, this does not mean that the economy is about to explode forward. However, there is now a lot of pent-up demand and as soon as it is apparent that we are not falling back into a recession, much of this demand is poised to come to the surface. Predictions are always tenuous, but we feel after a slower than expected first half, the time has come for forward progress. Many are predicting or at least hoping that this is the case.