I wish I had a dollar for every prediction of a coming great depression that I’ve heard over the first four months of this year. The forecast is gloomy and the general individual person lives in some state of fear about the future. The cost of a gallon of gas is clearly higher than ever and prices are rising in other markets as well.
But Lawrence Kudlow, an economist that I happen to profoundly respect, suggested yesterday that President Bush may turn out to be the top economic forecaster in the country in the end.
About a month ago, the president told reporters, "We’re not in a recession—we’re in a slowdown.” Then at a White House news conference a few weeks later, despite the fact that reporters pressed him to use the "R" word over and over, Bush still refused. (Sometimes his refusals are aggravating in how stubborn he seems to be at points.) But last Friday, after the most recent jobs report—which produced a much-smaller-than-expected decline in corporate payrolls, a huge 362,000 increase in the more entrepreneurial household survey (the best gain in five months) and a historically low 5% unemployment rate (4.95%, to be precise)—the president told reporters: "This economy is going to come on. I’m confident it will."
Is Bush crazy or is he correct? Time will tell. My hunch is that he may be right in the end. This might have immense political consequences come November, again reminding us how volatile all these things are in such times.
One thing is for sure—almost every “expert” seems to have predicted economic gloom and doom for months now. We are so convinced that we are headed for a complete economic collapse that we sound like a generation of Chicken Little’s crying, “The sky is falling.” And when it doesn’t we then tell ourselves, “Give it more time, it will.”
Larry Kudlow says that we are in “the midst of the most widely predicted and heralded recession in history. Problem is, so far it’s a non-recession recession.” Quite insightful I think. I am not a professional economist but I think he is right. Things could get worse but then they just might not. We at least ought to consider the economic good news here without buying into the bad news based on more media panic and attention to the wrong numbers.
First-quarter GDP growth was 0.6%. It wasn’t the widely predicted decline of many and economists actually expect that number to be revised up.
Gross domestic product growth for the fourth quarter of 2007 was also up slightly, while the prior two quarters averaged over 4% growth. These numbers simply do not support the pessimists at all.
"It seems unlikely," says Stanford professor Robert Hall, who heads the recession-dating committee at the National Bureau of Economic Research, "that we would ever declare a peak date when real GDP continued to rise."
So, do not believe everything you hear and only some of what you see. The way we interpret numbers, especially in an election year, is often in the eyes of the beholder. Christians would do well to control spending, increase giving to the Kingdom of God and get serious about savings.
And, most of all, they should stop buying into constant pessimism. Even if the economic bubble bursts our faith is still in the Lord of heaven and earth, or so it should be. Why all the angst about money? I just don’t get it. Have we known such prosperity that we forget how good we really have it? It sure seems that way to me.