Weekend Reading: Trust and the Benefit of the Doubt

Bruce Bartlett (October 9, 2012): Partisan Bias and Economic Forecasts: "On Sept. 27... James Pethokoukis, now employed by the conservative American Enterprise Institute, said that the United States economy was 'running out of steam' and that there was now a 50 percent chance of a recession within a year. 'It may be several years before we see unemployment below 8 percent'.... On Friday, the Bureau of Labor Statistics announced that the unemployment rate in September was 7.8 percent. On Sept. 29... David Malpass... took a similarly bearish view.... Current economic data, he said, “point to a recession in 2013.” On Oct. 1, Brian Wesbury... raised the risk of a recession to 25 percent in his weekly client letter.... In July, Mr. Malpass was predicting 2 percent real gross domestic product growth in 2012 and 3 percent in both 2013 and 2014.... [In] September survey, Mr. Wesbury was predicting 2.3 percent real growth in 2012.... The average forecast for all economists surveyed by The Journal in September was 1.9 percent real G.D.P. growth in 2012, 2.4 percent in 2013 and 2.9 percent in 2014.... None of the economists surveyed has predicted even a single quarter of negative real growth within the forecast window. Typically, a recession requires two back-to-back quarters of negative real growth...


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