Wednesday, February 20, 2013

Economy at stall speed

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Source:  FRED.  Data to 2012Q4.  The blue line is the value of the most recent observation.  Almost every other time this value has been seen the economy has been either going into recession imminently, or within a year or so.  Only in the 21st century has the economy managed to avoid recession by bouncing off the blue line.

The green line is linear trend over the period from 1950.  The red line is the trend over the past 30 years, which suggests that the US economy is headed for a state of secular stagnation and possible collapse.  

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