We’re Squeezing the “Recovery” for Every Penny

by Robert Williams, Publisher
Thursday, October 15, 2009

Well, it’s official: The recession is over.

According to the latest survey of 44 economists by the National Association for Business Economics (NABE), a whopping 81% said the recession is over. Following a sharp 6.4% economic contraction in the first quarter. And another 0.7% drop in the second quarter, the seers over at the NABE expect real GDP to rise at an “above trend” 2.9% clip in the second half.

However, the report also said, “The economic recovery is likely to be more moderate than those typically experienced following steep declines.”

Gee, you think?

We’re all for optimism. But you know our thoughts on the folly of trying to predict the economy’s next move.

And quite how these economists can declare the end of the recession when more than half of them don’t expect the lost jobs to be replaced until 2012 is an absolute mystery. (Keep in mind, too, that housing remains in a state of disrepair and unemployment is approaching 10%.)

For the record, we don’t take our cues from pundits who’d rather grab juicy headlines than offer any actionable investment ideas, with true merit.

Use today’s issue as proof. In his article about spread trading, Karim Rahemtulla explains 1) why a broad strategy is the most prudent in this market, and 2) how you can leverage the options market to pull it off.

Best of luck squeezing this information from Kiplingers.

Ahead of the tape,

Robert Williams

P.S. Last month, we had a friendly debate over the economy between reknowned economist Mark Skousen and our very own David Fessler. Debunking the Paradox of Thrift spawned incredible feedback. And now Mark and Dave are hitting the airwaves to continue the debate!

The show “Corporate Strategies with Tim Connolly” will air the showdown this Friday, 10:00 AM EST. The show can be heard live here: www.crntalk.com. Or for more information, visit the show’s website at www.corporate-strategies.net/radio/

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