I returned home this afternoon from a conference and turned on the new 24hour news channel, ABC24, and was listening to a couple of Australian finance experts say how positive they are about the US Economy. The ABC interviewer said Robert Shiller (Yale Professor of Economics and early predictor of both the tech crash and US home price crash) said there was a 50-50 chance of a double dip recession after which they both strogly disagreed. Anyway, I digress, I actually just read the Robert Shiller comments and he actually said,
For me a double-dip is another recession before we’ve healed from this recession … The probability of that kind of double-dip is more than 50 percent. I actually expect it.
There are in fact many many US academics who are expecting a double dip recession and they are largely putting it down some or all of the folloiwng reasons (courtesy www.caclulatedriskblog.com) …
- Less federal spending this half
- End of the inventory rebuild
- Continued household deleveraging
- Another downturn in housing
- Slowdown in China and Europe
- Cutbacks at both State and Local level
Now the Australian fund managers may be right and the US may not enter recession again and perhaps I’m reading the wrong material, but I have to admit that it is very rare that I hear Australian fund managers talk of anything but bullish markets and economies…I’m afraid their conflicts of interest on these macro issues have lead me to no longer listen to a word they say.
1 pings