Da Future

Posted by Jeff Carter
on July 2nd, 2010

Lots of economics blogs out there. It is fashionable to be an economist now. Even Obama has given up law and has become an economic prognosticator. Of course, like most of them he has been wrong. To be a real economist, you must dress poorly, wear a pocket protector(holds all your colored pencils to make pretty graphs), and never be more than arm’s length away from a computer-or at least access to “your data”.

Different economists will spin data different ways. When you hear Krugman, Roemer, Summers or anyone tied to the administration speak, that is all it is, spin. They are not necessarily telling the truth. Today, Roemer was on television gushing about the employment report. The sack that you put stuff in is worth more. The employment picture is not getting prettier.

It pays to ignore the spin and look at blogs and economists that have correctly forecasted what is a very difficult economy to predict. Here is link to a blog that has had it right. The future looks extremely scary if their crystal ball is right. In the past, they have forecasted almost correctly to the exact percentage point.

Going forward, if we accept that they are correct, we are in for a heap of trouble. It’s not going to be pretty, as GDP drops. From their stats, factories have been rebuilding inventories which have accounted for all the GDP growth this year. They state that if factories have over corrected and gotten too optimistic, it could be really ugly on the reverse.

More on this at Tigerhawk. The chart he posted focuses on duration of unemployment. The percentage of people unemployed for 27 weeks or longer is rising precipitously. Very steep slope on the line.

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