But next year, economists foresee a convergence of several factors that could finally kick this recovery into high gear.
First on the list is the federal budget. After epic fights this year over the “fiscal cliff,” the “sequester,” and a bunch of other wonky stuff, lawmakers have finally managed to cobble together enough tax hikes and spending cuts to at least stabilize the country’s credit rating.
Rising home prices are helping, too. Fewer Americans are trapped in underwater mortgages that leave them owing more on their home than the house is worth. Rising prices also boost the net worth of homeowners, adding to consumer confidence.
Businesses have been complaining for years about “uncertainty” in the public policy area. Next year, some of those unknowns will finally be resolved.
Companies have held off on hiring because they’re waiting to see how they’ll be affected by health care and finance reform laws, according to John Silvia, chief economist at Wells Fargo. The implementation details of both of those laws will become clearer over the next year.
“Dodd-Frank and Obamacare need to be worked out, then employment takes off,” Silvia said.
He believes 2014 “could be a very good year.”
Just how good? Steve Blitz, chief economist at ITG Investment Research, thinks GDP growth in the 3.5% to 4% range is possible for 2014, if the global economy doesn’t deteriorate. Monthly job growth could peak in the 300,000 range, he believes.
Blitz anticipates a large numbers of Millennials entering the car-and-home-buying stage of life, giving an added boost to the economy. Plus, the drop in defense spending associated with the draw-down of troops from Iraq and Afghanistan should be largely behind us.
“All of these should add up to a better economy in 2014,” Blitz said.
So, next year is the year folks!
Next year the tax hikes and spending cuts (what?) are going to stabilize our credit rating, because that rating has nothing to do with the trillions of dollars of funny money we’ve been printing at the Fed.
Next year businesses will finally start hiring, once Obamacare is in effect, because those extra thousands of dollars in premiums or fines that small business owners will be forced to pay are a boon for the jobs market.
Next year, after we pull our troops out of Iraq and Afghanistan, there will be a drop in defense spending… except we’re now mobilizing for a war in Syria, and possibly Iran.
Mac Slavo Views:
Read by 32,874 people Date: June 24th, 2013 Website:www.SHTFplan.com
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