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American Exceptionalism
For the fifth straight year, expectations are running high that this time around the U.S. economy will take off and reach “escape velocity.” The prevailing belief is that, while the Eurozone may be flirting with chronically weak growth and deflation danger, America faces no such threats. And even if most other major developed economies may be “becoming Japan,” that cannot possibly hold for the U.S.
From the incoming Fed Chairman to mainstream analysts and other policymakers, such optimism is one reason why disappointing data, like recent job growth and inflation figures, have been so confounding. So is the U.S. uniquely poised to reach escape velocity?
ECRI’s latest report provides the outlook for U.S. growth, with specific attention to jobs, housing and trade, that reveals the likely cyclical picture in coming months.
Taking the longer view, there is a pressing need for an adult conversation about what is going on with U.S. economic growth, instead of refusing to acknowledge the problem. The reality is that major structural changes are occurring in developed countries around the world – including the U.S. – resulting in more frequent recessions in these economies, as is already obvious in Europe and Japan.