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Barry Ritholz on why this isn't a Goldilocks economy. He thinks so, because of weak jobs creation, Retail Sales, Inflation, GDP, Retail Sales, Bankruptcy, Real Estate, Savings Rates, Yield Curve, Account Balances, etc.
==> I love BR's blog, but I disagree with him on most of these things. We often hear the Democrats claim that job growth is weak. But remember, the late 1990's were a once-in-a-generation bubble. Things were extended. Wage growth was huge. Remember when everybody wanted to quit their jobs to be $250/hr web programmers? Those days are gone, as are the days of bidding wars for employees. The 2001 recession was relatively mild, and now that we're in an economic expansion, the unemployment rate has fallen to 5%. Historically, many have cited 5% unemployment as "full employment." If we're at full employment, can we expect new job growth to exceed population growth? I doubt it, unless the economy starts to overheat.
Don't get me started on inflation. Inflation is very mild. Core rates have barely a pulse. Notice the "massive" discounting at retail stores for holidays, as they try to move inventory. Also, did you catch one of the reasons for the weakness in yesterday's retail numbers? Falling prices at the gas pumps!
While sales were not as strong as some had hoped, much of the weakness was due to a 5.9 percent drop in sales at gasoline stations in November -- a direct result of the decline in gas prices last month and hardly bad news for consumers.
We know GDP is clocking along over 4%, so I'm not sure why BR thinks this demonstrates a weak economy. The yield curve is pretty flat, but we don't have inversion and the long-term bond shows nothing with regards to inflationary pressures.
Just some thoughts on BR's comments. I hope you have his blog feed wrapped up in your news aggregator! He'll be on Larry Kudlow's CNBC show tonight, so make sure to catch it live or on your Tivo (or Media Center PC)!