As you may have heard already, the jobs numbers for the US came out and they confirmed that the US private sector continues to create 150-200,000 new jobs each month. This is consistent with moderate and does not indicate any signs of recession. The US can only fall into a recession because of fiscal cuts that ricochet back onto the private sector.
Now, the US did show a contraction in output based on preliminary estimates of Q4 GDP. However, these numbers are preliminary and subject to revision. More importantly, however, they highlight that the shortfall in output is not coming from private demand, which is still relatively robust in the US. Rather, the contraction stemmed from cuts in government spending and an unexpected inventory purge, also potentially due to anticipated cuts in gov...
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Edward Harrison is the founder of Credit Writedowns and a former career diplomat, investment banker and technology executive with over twenty five years of business experience. He has also been a regular economic and financial commentator in print and on television for the past decade. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.