From USAToday,
The Federal Reserve said the economy will be weaker than it initially forecast through 2011, though the central bank still expects the recession to end this year.
This is something that I have mentioned time and again. Economic predictions are darn near worthless and it seems you might as well flip a coin sometimes. I remember that they were talking about the second half of 2008 turning around but then September happened.
The Fed now expects the economy to contract by 1.3% to 2% this year, worse than the 0.5% to 1.3% fall it projected in January, according to minutes of the April 28-29 meeting of the policymaking Federal Open Market Committee released Wednesday. By 2010, the Fed anticipates growth of up to 3% and as much as 4.8% in 2011. That’s also lower than its January outlook
I d0n’t understand how they come up with their numbers but I don’t think it matters since they keep revising them. Personally I have had two offers on different homes in the last two days so it feels like it is getting busier.
When will the economy turnaround? Unfortunately it will take optimism to turn things around. Without optimism who will spend and take risks which grows the economy?
And though some of the media outlets might try to give hope and optimism much of it falls flat when they have to revise numbers or tell us that results came in below expectations. In this state of distress why do they even bother with predictions? Just wait until the numbers come out.
When I was a kid, and maybe this is where it comes from, my parents told me three summers in a row that we were moving. The first summer I told all of my friends, complained about it, and then waited. We didn’t move.
The second summer they told me we were going to move I got a little more excited because I had accepted the idea the year before. We didn’t move. I just ignored them the third year. Except to write my opinions here, I pretty much ignore the news now.*
If the economy recovers will I feel it immediately? Nope. Things will just start to happen. Just as real estate is local, and even-hyperlocal, so is the economy. Just keep living.
*Last I saw, everytime the news talked about the economy they put up a graphic that read, “ECONOMY IN CRISIS.” First of all stop it. Who does that help? Are you trying to scare people into the watching you? Usually when something scares someone they will avoid it. Think about it TV Directors.
