{"id":1902,"date":"2011-12-31T09:57:24","date_gmt":"2011-12-31T14:57:24","guid":{"rendered":"http:\/\/www.billdawers.com\/?p=1902"},"modified":"2011-12-31T09:57:24","modified_gmt":"2011-12-31T14:57:24","slug":"washington-post-on-the-big-economic-questions-of-2012","status":"publish","type":"post","link":"http:\/\/www.billdawers.com\/2011\/12\/31\/washington-post-on-the-big-economic-questions-of-2012\/","title":{"rendered":"Washington Post on the big economic questions of 2012"},"content":{"rendered":"<div class=\"e26b170012445c56d240655bdd03f7bf\" data-index=\"1\" style=\"float: left; margin: 10px 10px 10px 0;\">\n<script type=\"text\/javascript\"><!--\r\ngoogle_ad_client = \"ca-pub-5595881567027133\";\r\n\/* Medium Rectangle *\/\r\ngoogle_ad_slot = \"8584504377\";\r\ngoogle_ad_width = 300;\r\ngoogle_ad_height = 250;\r\n\/\/-->\r\n<\/script>\r\n<script type=\"text\/javascript\"\r\nsrc=\"http:\/\/pagead2.googlesyndication.com\/pagead\/show_ads.js\">\r\n<\/script>\n<\/div>\n<p>This is another in a short series of posts looking at credible economic predictions for 2012.<\/p>\n<p>There&#8217;s a great piece in the Washington Post today, <a href=\"http:\/\/www.washingtonpost.com\/business\/2011-was-a-bust--could-2012-be-better\/2011\/12\/26\/gIQALpZeQP_story.html\" target=\"_blank\">2011 was a bust \u00e2\u20ac\u201d could 2012 be better?<\/a> Of course, 2011 was not a bust. Despite some daunting obstacles, the U.S. economy continued to grow over the past year.<\/p>\n<p>2011 was only a &#8220;bust&#8221; in comparison to the unrealistically high goals that many analysts had for the year.<\/p>\n<p>Today&#8217;s piece in the WashPo, written by Neil Irwin, is quite lengthy, but closes with five key questions for 2012:<\/p>\n<blockquote><p><strong>Will the U.S. political system behave itself?<\/strong><\/p>\n<p>The debate over the role of government and tax law needs to unfold without the threat of default or downgrade.<\/p>\n<p><strong>Can China amp up consumption?<br \/>\n<\/strong><br \/>\nIt needs to shift to greater reliance on domestic demand for consumer goods and services, and away from exports and housing investment.<\/p>\n<p><strong>Will we be lucky enough to avoid an X-Factor?<br \/>\n<\/strong><br \/>\nWhen the economy is strong, even seemingly big blows are manageable. It\u00e2\u20ac\u2122s the nation\u00e2\u20ac\u2122s underlying weakness that makes random events seem so consequential. That said, a bit of good luck \u00e2\u20ac\u201d meaning no new surprise disruptions \u00e2\u20ac\u201d would be helpful in not undermining the economy.<\/p>\n<p><strong>Will the housing market bottom out?<br \/>\n<\/strong><br \/>\nA cause for optimism is that the United States has been under-building houses \u00e2\u20ac\u201d constructing and renovating too few homes to keep up with a growing population \u00e2\u20ac\u201d for half a decade. With 1.2 million new houses built each year in normal times, the 600,000 or fewer homes started in each of the past three years won\u00e2\u20ac\u2122t fulfill that demand.<\/p>\n<p><strong>Can European leaders balance every country\u00e2\u20ac\u2122s demands?<br \/>\n<\/strong><br \/>\nThey will collectively decide whether their continent fixes its financial troubles or lets them spiral out of control. If instead of muddling through they usher in a consistent, credible era of European unity, and the European recession turns out to be mild or nonexistent, it could boost the stock market and business confidence \u00e2\u20ac\u201d and hence, hiring \u00e2\u20ac\u201d worldwide.<\/p><\/blockquote>\n<p>The housing analysis here is more than a little thin. It&#8217;s not about homebuilding to meet population growth; the issue is household creation, not population. Also, we may have been &#8220;underbuilding&#8221; for a few years now, but that doesn&#8217;t mean we&#8217;ve eaten up a sufficient amount of the excess supply yet. Also, there&#8217;s the shadow inventory to worry about.<\/p>\n<p>But Irwin seems to me to be asking the right questions here.<\/p>\n<div class=\"e26b170012445c56d240655bdd03f7bf\" data-index=\"4\" style=\"float: none; margin:4px 0 4px 0; text-align:center;\">\n<script type=\"text\/javascript\"><!--\r\ngoogle_ad_client = \"ca-pub-5595881567027133\";\r\n\/* Another large rectangle *\/\r\ngoogle_ad_slot = \"0042810896\";\r\ngoogle_ad_width = 336;\r\ngoogle_ad_height = 280;\r\n\/\/-->\r\n<\/script>\r\n<script type=\"text\/javascript\"\r\nsrc=\"http:\/\/pagead2.googlesyndication.com\/pagead\/show_ads.js\">\r\n<\/script>\n<\/div>\n\n<!--CusAds0-->\n<div style=\"font-size: 0px; height: 0px; line-height: 0px; margin: 0; padding: 0; clear: both;\"><\/div>","protected":false},"excerpt":{"rendered":"<p>This is another in a short series of posts looking at credible economic predictions for 2012. There&#8217;s a great piece in the Washington Post today, 2011 was a bust \u00e2\u20ac\u201d could 2012 be better? Of course, 2011 was not a&hellip;<\/p>\n<p class=\"more-link-p\"><a class=\"more-link\" href=\"http:\/\/www.billdawers.com\/2011\/12\/31\/washington-post-on-the-big-economic-questions-of-2012\/\">Read more &rarr;<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[4],"tags":[25],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p1gN9R-uG","jetpack_sharing_enabled":true,"jetpack-related-posts":[],"_links":{"self":[{"href":"http:\/\/www.billdawers.com\/wp-json\/wp\/v2\/posts\/1902"}],"collection":[{"href":"http:\/\/www.billdawers.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.billdawers.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.billdawers.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.billdawers.com\/wp-json\/wp\/v2\/comments?post=1902"}],"version-history":[{"count":0,"href":"http:\/\/www.billdawers.com\/wp-json\/wp\/v2\/posts\/1902\/revisions"}],"wp:attachment":[{"href":"http:\/\/www.billdawers.com\/wp-json\/wp\/v2\/media?parent=1902"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.billdawers.com\/wp-json\/wp\/v2\/categories?post=1902"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.billdawers.com\/wp-json\/wp\/v2\/tags?post=1902"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}