Slowing growth does not signal a recessionary contraction

Although the year began with a fizzle, Beacon Economics is forecasting that the U.S. economy will not enter into a double dip recession in 2011

By ·

Although the year began with a fizzle, Beacon Economics is forecasting that the U.S. economy will not enter into a double dip recession in 2011.

Similar to the recent ISM findings, Beacon suggests that growth will pick up modestly in the last half of the year and into 2012.

While the nation’s economy slowed sharply during the first half of this year, slowing growth is not the same thing as a recessionary contraction. For the economy to actually shrink, there needs to be a significant and sustained negative shock to the system. Beacon Economics does not identify any such shock hitting in 2011. A number of good signs include stabilizing home prices and the fact that construction should pick up somewhat by the end of 2012. Population growth is sure to help chip away at excess housing supply nationwide.

And while Beacon share’s our reservations about President Obama’s recent proposal to help jumpstart the economy, if portions of the package are adopted, there may be some positive economic effect.

Beacon Economics is optimistic in the short term, but they note that the U.S. economy is still far behind where it should be in this stage of the business cycle, explaining much of the weakness in the labor markets.

There remain serious issues leftover from the massive imbalances that pushed the nation’s economy into recession in the first place.

Beacon believes that ultimately, there are some painful but necessary adjustments to be made and issues to address –including the Federal budget deficit and recent “loose money” policies by the Federal Reserve.


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

Subscribe to Logistics Management Magazine!

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your entire logistics operation.
Start your FREE subscription today!

Article Topics

Economy · Global · Global Trade · All Topics
Latest Whitepaper
The View from the New “Single Window”
The single window, officially known as the "International Trade Data System," operates via the Customs and Border Protection (CBP) agency's Automated Commercial Environment (ACE) platform, and serves as a single point of contact for all trade filings.
Download Today!
From the March 2017 Issue
WMS vendors are stepping up to the plate and developing functionalities and solutions that meet the complex needs of today’s companies. Our top analysts take a peek into these developments and discuss the DC of the future and the software that will support it.
5 Supply Chain Trends Happening Now
2017 Warehouse/DC Equipment Survey: Investment up as service pressures rise
View More From this Issue
Subscribe to Our Email Newsletter
Sign up today to receive our FREE, weekly email newsletter!
Latest Webcast
2017 Trucking Regulations & Infrastructure Update
In this session our panel brings shippers up to date on the state of transportation regulations. Discussion will revolve around regulatory reform, aspects of the federal highway bill and what the transportation landscape looks like in the early days of the Trump administration.
Register Today!
EDITORS' PICKS
LM Exclusive: Major Modes Join E-commerce Mix
While last mile carriers receive much of the attention, the traditional modal heavyweights are in...
ASEAN Logistics: Building Collectively
While most of the world withdraws inward, Southeast Asia is practicing effective cooperation between...

2017 Rate Outlook: Will the pieces fall into place?
Trade and transport analysts see a turnaround in last year’s negative market outlook, but as...
Logistics Management’s Top Logistics News Stories 2016
From mergers and acquisitions to regulation changes, Logistics Management has compiled the most...