Tuesday, January 17, 2012

Yardeni Spots the Recovery and Calls it a Double Recovery

Writes Yardeni:
The US economy may be on the verge of a big comeback. It could experience an unusual second recovery over the next three years following the weak initial recovery of the past three years. In the past, recessions were followed by one broad-based recovery in economic activity. The Naysayers have been predicting a “double dip” recession for the US economy since it started to recover in 2009. I’m suggesting that a more likely scenario might be a double back-to-back recovery.
Long time EPJ readers will recall that I called the first "recovery" and the downturn and the current recovery.

Bottom line: This roller coaster environment is the result of mad stop and go money printing by Fed chairman Bernanke. Who really knows what Bennie has in store for us at the next curve? I'll be watching and reporting.

In late 2011, there has been a major burst of money growth that has in the last few weeks been slowed just a bit by Bennie. To me it looks like there is enough money to keep the manipulated recovery going for at least six months. After that it depends on what amount of money printing is done.


  1. have you offered up any forecasts as to when the bond bubble will burst and the extreme inflation hits?

    1. Nobody can predict with any certainty the time that an economic event will happen, we can only predict general trends based on current information. Economics is not a predictive science. Since I know that Bob agrees with me on this, I would be willing to bet that he has not made such forecasts.

    2. I am fully aware its impossible to predict exact timing. I would still like to hear Mr. Wenzle's opinion though.

      Is there a realistic possibility of seeing it start in 1 year? 3? 5?

      Seems to me like its only a failed treasury auction away.

  2. I don't think M2 will stay flat for too much longer, I think it will resume its growth going into spring/summer. There is an election coming up next autumn and I think that is the prime consideration at this point (to make the economy look good for the incumbent).

  3. What's your take on Yardeni? He went overboard on the Y2K stuff but I can forgive him for that.

    Is he a die-hard Keynesian? He seemed pretty sensible back in the day but I haven't read him lately.