According to a Bloomberg report published earlier, "Jobs Outlook in U.S. Improves for 2012, Business Economists Say," professional prognosticators seem to be growing more optimistic by the day:
Employment will improve more this year than economists previously estimated, helping the world’s largest economy to keep growing, a private survey showed.
Payrolls will rise 170,000 a month on average in 2012, up from a November projection of 127,000, according to the results of a survey by the National Association for Business Economics issued today in Washington. Unemployment will average 8.3 percent, down from 8.9 percent in the prior forecast.
The better outlook for jobs coincides with larger gains in business investment and homebuilding than were anticipated, the survey showed. At the same time, economists maintained forecasts for consumer spending, which may rise 2.1 percent, and predicted economic growth of 2.4 percent in the fourth quarter from a year earlier, unchanged from the November survey.
Respondents “are seeing strength in a number of economic measures,” Gene Huang, NABE president and chief economist at FedEx Corp., said in a statement.
Just for fun, why don't we go through a list of recent developments to try and figure out how they arrived at that conclusion:
Fuel costs hitting new highs? Check.
"Gas Prices Keep Rising: $3.70 Nationally, $4.29 in California" (Los Angeles Times)
Going somewhere? It’ll cost you even more this week, with the national average price of a gallon of regular fuel now up to nearly $3.70 and rising 26 cents to $4.29 in California.
That’s up 14 cents a gallon from a week ago and a 29-cent increase from a month ago. A gallon is now more than 10% more expensive than the $3.35 it cost this time last year, according to the AAA Fuel Gauge Report.
But in California, drivers are wishing prices were still that low. The state’s average cost for a gallon is $4.29, compared to $4.03 a week ago. That’s nearly 15% more than the year-ago cost of $3.74 a gallon.
For more than a year, gas prices in California have hovered above the national average. Prices have already reached levels usually not seen until springtime, when refineries temporarily close for maintenance and more expensive summertime fuel blends are being swapped in at the pump.
Concerns about troubles in the Middle East could also be a factor in the spike, some said. The Obama administration cautioned last week that it may decide to draw from the nation’s emergency oil reserve to keep high prices from slowing the economic recovery.
World's largest economic region entering a downturn? Check.
"Euro Zone in Recession, Commission Declares" (Irish Times)
The European Commission yesterday said the euro zone had entered its second recession in three years.
Economics commissioner Olli Rehn insisted the recession was “mild” and that the European economy was showing signs of stabilising, but his new forecast said the recovery would be more modest than hoped and would come later this year than previously expected.
With no end in sight to the sovereign debt crisis, the European Commission believes the euro zone economy will shrink by 0.3 per cent this year on a gross domestic product (GDP) basis, while the EU as a whole stagnates.
It previously said the euro zone would expand by 0.5 per cent and the EU by 0.6 per cent.
The commission scrapped the growth forecast for Italy and Spain, saying the Italian economy would shrink by 1.3 per cent, with Spain falling 1 per cent.
Longstanding global economic locomotive running out of steam? Check.
BEIJING: A property sector downturn and slumping global demand may knock China's economy into a hard landing in 2012, a senior government economist told Reuters, putting more pressure on Beijing to speed up economic reforms and to open up the market.
The economy is not just slowing but is also haunted by over-investment that could constrain Beijing's options, said Shi Xiaomin, vice president of China Society of Economic Reform (CSER), a Beijing-based think-tank.
No real turnaround in a key sector of the economy? Check.
Below is some more hard data where you won't find the much anticipated, 'any minute now', housing recovery. While the first chart shows the annualized new home sales sold data, which came in at meaningless 321K in January on expectations of 315K, and a meaningless drop from an upward revised 324K, all this shows is that 3 years after the "recovery", there is zero improvement in housing. In non-SAARed terms, there were just 22K homes sold in January. Naturally, this is to be expected because as long as the government continues to prevent true price discovery, there will be no real housing market. Which is just what the second chart shows: Completed houses for sale at the end of period dropped to 57K - this is the lowest point in the 40 years of this data series. Said otherwise nobody has any hopes that there will be a pick up in housing demand. And why should they - after all as the third and final chart shows, shadow inventory is at a record, and about to be unleashed on the market at bargain basement prices courtesy of the Robo-settlement, which in turn will drag down prevailing prices far, far lower everywhere. Welcome to the latest housing non-recovery.
New Homes for sale, courtesy of John Lohman:
Record low completed houses for sale at the end of the period:
And record high shadow inventory:
Growing potential for upheaval in the Middle East? Check.
The Pentagon has begun to take tangible steps to prepare for a possible conflict with Iran by making formal plans to boost US sea and land defences in the Persian Gulf, it has been claimed.
Military planners have asked for emergency funding from Congress to address a perceived shortfall in defence capabilities that could undermine the ability of US forces to respond to an Iranian closure of the Strait of Hormuz, the Wall Street Journal quoted American officials as saying.
Gen James Mattis, the head of the US Central Command, has privately informed Congress of his intentions to place mine detection and clearing equipment in and around the Strait and to boost surveillance capabilities in the Gulf.
There are also plans to modify weapons systems on ships that are at present vulnerable to Iranian fast-attack boats, many of which carry anti-ship missiles.
Reflecting Pentagon fears that the US could be sucked into a war by the end of the year, the Central Command told Congress that it wanted the new systems in place by the autumn
Consumers turning back to old bad habits? Check.
"US Credit-Card Debt Nearing Toxic Levels" (New York Post)
More American households are falling back into the debt hole — this time without the safety net of home values to help bail them out.
Last year, total US consumer debt reached the highest point in a decade, according to a credit-card industry observer.
“Now more than ever, families need to work at saving and paying off any outstanding debts,” says Howard Dvorkin, a CPA and founder of ConsolidatedCredit.org, a credit counseling service.
He says that, after a few months of reducing credit-card debt levels, Americans are starting to return to their reliance on debt.
“People made some progress in reducing card debt earlier in the year, but in the last few months, as the stock market started to rise, they started to return to their old ways of charging things,” Dvorkin says.
In December, the total consumer debt, which is the combination of non-revolving and revolving debt, rose by some 9.3 percent to $2.498 trillion, according to the latest Federal Reserve Board numbers.
Both revolving debt and non-revolving debt increased. Revolving debt, which is credit-card debt, went up by 4.1 percent. Non-revolving debt, which includes loans for cars and education, rose 11.8 percent, the central bank’s report said.
The trend — month to month, quarter to quarter and year to year — is rising steeply
Yeah, they're right. Things are lookin' reeeaaaalllllllll good.