Pethokoukis, Economics, U.S. Economy

Maybe this helps explain why the stock market has been doing so well

Image Credit: James Hamilton and the Atlanta Fed

Image Credit: James Hamilton and the Atlanta Fed

I know the stock market likes to climb a wall of worry, but perhaps that’s not true at the moment. Less concern about the euro and perhaps less concern about the US economy could be boosting investor sentiment. From Economist James Hamilton via the Atlanta Fed:

The GDP-based recession indicator index is a pattern-recognition algorithm that assigns dates to when recessions begin and end. It is based on the observed dynamics of U.S. real GDP growth. …U.S. real GDP growth has increased modestly each quarter since 2009:Q3 up through 2012:Q3, though the growth has been persistently sluggish. Although the slow growth has been disappointing, the index currently stands at 8.2 percent. This means that the U.S. economy would not be characterized as currently being in a recession. The BEA’s initial estimate that real GDP fell slightly in 2012:Q4 is factored into this assessment, but turns out not to change the inference about 2012:Q3 materially.

3 thoughts on “Maybe this helps explain why the stock market has been doing so well

  1. The stock market is doing well because the Elite are letting the GAMBLING Wall Street folks do what they do best, trying to out-think their competitors. It will all COLLAPSE (for a short while) when the Elite want to cash in so they can buy back in low again. It’s a CYCLE that the Elite control to STEAL from the lemmings/peasants/serfs/slaves

  2. I don’t disagree with this analysis; but, this is the same Fed that couldn’t see the financial crisis coming in 2007 and 2008.

  3. “Unexpected” should be the key word in understanding how smart the marketers are(n’t). Program trading has taken the place of cognitive analysis and action.

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