I don’t think there is a 100% chance of a recession next year, but I do think it will begin. Japan is in a recession. So is Western Europe. It is a stretch to think that the USA will sail through this in the black.
Germany’s economy is slowing. It has been the tide that kept the other nations afloat. Its central bank predicts a meager .4% growth for 2013.
The search for a nation to pick up the slack in demand for American exports — as a result of the recessions in the euro zone and Japan — has turned to China. Nevertheless, on Monday, China’s Customs Bureau reported that the nation’s imports rose only 2% in November, declining from a 2.4% increase in October.
Where is the Little Engine That Can?
Bernanke thinks that unemployment will remain high until mid-2015. Even then, it may still be at 6.5%. That’s high.
I suggest that any talk of continued recovery in the USA is whistling past the graveyard. But most forecasters think this nation will be immune. Japan and Europe have nothing to do with us, they imply.
This seems likely: no raises, no boom, and no reduction of the federal deficit.