Ezrati's Economic Outlook: A Wake-Up Call on the Economy

Ups and downs in statistics obscure slow but steady recovery.

The recent weak jobs report should serve as a wake-up call to economic reality. The news that payrolls expanded by only a meager 120,000 in March was disappointing, but far from momentous. But it should remind investors and business people that earlier signs of strength overstated the economic fundamentals and that the recovery, though reasonably secure, was plodding along and will likely continue to do so.

Economic statistics seem at times to have their own ebb and flow, sometimes overstating and sometimes understating the underlying fundamentals. Sadly, these often meaningless data variations can create false feelings about economic possibilities: enthusiasm when the statistical flow leans toward the strong side or despair when it leans to the soft side. Investors in particular succumb to such swings in attitude, but to a lesser extent, so do business people. So it was with the string of unsustainably good numbers late in 2011 and earlier this year.

About the Author

Milton Ezrati

Milton Ezrati

Milton Ezrati is senior economist and market strategist for Lord Abbett & Co. and an affiliate of the Center for the Study of Human Capital and Economic Growth at the State University of New York at Buffalo. His latest book, Thirty Tomorrows, linking aging demographics and globalization, will appear next summer from Thomas Dunne Books of St. Martin’s Press. See more of his articles about the economy here.

 

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