AP: Economy Ends Tough 2011 on a Surprising Upswing

AP economics writer reports what EPJ readers understood months ago was coming:

The economy is ending 2011 on a roll.

The job market is healthier. Americans are spending lustily on holiday gifts. A long-awaited turnaround for the depressed housing industry may be under way.....Factories are busier. Stocks are higher.

Not bad for an economy faced with a debt crisis in Europe and, as recently as this summer, scattered predictions of a second recession at home. Instead, the economy has grown faster each quarter this year, and the last three months should be the best.

Here's what AP reports Krugman-like Keynesian economists were saying as recently as August:

When The Associated Press surveyed 43 economists in August, they pegged the likelihood of another recession at roughly one in four. The Dow Jones industrial average was lurching up or down by 400 points or more some days.

There was plenty of reason for gloom. A political standoff over the federal borrowing limit brought the United States to the brink of default and cost the nation its top-drawer credit rating.

This is I wrote on August 11:

Underneath the surface, though, the Fed is aggressively pumping money, which will create a new manipulated boom. The developing manipulated boom is what the insiders are seeing. Money is flowing and will work its way into the stock market.

I doubled-down in October. This is what I wrote on October 7:

Bottom line: Keynesians are clueless. The private sector continues to improve because of Bernanke money printing and the shrinkage is now pretty much at the local government level, as a result of declining tax revenues (which will also reverse itself in coming months). There is no double dip. The stock market and economy will soon go into a Fed manipulated boom, that will have Keynesians scratching their heads even more.