Sherry Cooper,an economist with BMO Financial Group,has been named the most accurate economist by Arizona State University's W.P. Carey School of Business.Dr.Cooper has also been recognized as one of Canada's most influential women.Educated by the University of Pittsburgh,she was selected as most accurate from a panel of 50 economists by Arizona State.
Dr.Cooper and her team were credited with pinpointing key indicators of both the beginning and end of the recent severe recession.
There's still a big unemployment overhang,Dr.Cooper observed.It wasn't caused by high interest rates as in previous recessions.Businesses laid off massively,so they're reluctant to hire back until the orders really start to come in.Employment contracted by 6%,which is totally unprecedented.
Until we start to see expansion in new businesses as well as old,it's hard to get everyone back to work.We could see unemployment at 9% by the end of 2011.The wave of inventory restocking is over,so the purchasing of equipment and machinery won't be as strong,either.
On the plus side,Dr.Cooper noted that consumption is growing a little bit more.The consumer is starting to come back.The effect of quantitative easing 2,the Federal Reserve's purchasing of more assets,will be pretty modest,but it is stimulative.
We're in a disappointingly slow recovery,but there won't be a double dip recession.
Bank of Montreal(BMO)
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