Sunday, March 11, 2012

Economy: Sustainable Growth?

Just a quick update on the economy. The jobs report on Friday was pretty good. However, there is apparently some concern over the disconnect between the jobs numbers and the GDP numbers:
Fed officials have been surprised unemployment has fallen to 8.3% from above 9% in just a few months despite very modest economic growth. Usually it takes much faster growth to move the jobless rate so much. That could mean the unemployment declines aren't sustainable, or it could mean the economy has more underlying strength than recent data indicate.
Some of the economists I follow think this might mean that the era of jobless recoveries is over. I hope so. But I am worried about whether the growth is sustainable. Just want to put that out there. 

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