Summary of key points
- The recovery is real and new jobs will come soon.
- ECRI's FIG says inflation is in a cyclical upturn but inflation is not YET a problem.
- "Simmering Inflation Pressure is a good thing" compared to a year ago when we worried about an economic collapse.
- Compared to ECRI's FIG, the FED's inflation estimates use more "rear view" indicators which may explain why they kept rates too low after the last recession which may have led to the housing bubble.
- ECRI's FIG turned up far before the Fed increased rates after the last recession and we all know what happened to the housing market.
- ECRI's WLI says GDP growth will "throttle back" some from its recent 6% (5.9%) level but the recovery is real and we will not have a double dip this year.
- The FED may get "bailed out" from keeping rates so low if economic growth throttles back later this year as ECRI expects but they won't try to predict their indicators.
- More about ECRI
- July 31, 2009: ECRI Predicts End of Home Price Downturn
- July 21, 2009: ECRI Predicts The End of the Recession is Imminent
- April 3, 2009: Upturn in ECRI's WLI Growth Rate Says US Business Cycle Recovery Ahead
- March 28, 2008: ECRI Calls it "A Recession of Choice"
- January 05, 2008 ECRI Says Fed Has Room To Cut Rates Despite Fears of Inflation