Reasons to Bet Against a Double-Dip Recession

Data don't support hysterical headlines

By Polly Davis Doig,  Newser Staff

Posted Jul 19, 2010 3:34 PM CDT

(Newser) – Fears of a double-dip recession is running high, but economic data suggest that they are unfounded. Writing in the Wall Street Journal, Milton Ezrati of the money management firm Lord Abbett explains:

  1. The consumer is regaining strength: A 1.4% decline in retail sales for May gave rise to double-dip fears, but that was after 10% advance over the past 12 months. Meanwhile, household income is on the rise, and Americans are saving more—suggesting they can keep up current spending while paying down debt.

  1. Housing: The first-time-homebuyer tax credit crowded purchases into the end of last year, creating the appearance of a dip in the months that followed. But the inventory of unsold homes is dropping fast, and a prices rose by 5.3% in May.
  2. Employment: Overall unemployment continues to hang around 10%, but hours and temp hiring—the first signs of recovery—have begun to pick up.
To see all of Ezrati's reasons—he has seven—click here.

In this photo taken June 28, 2010, job seekers wait in line to register and attend a National Career Fair in San Francisco.
In this photo taken June 28, 2010, job seekers wait in line to register and attend a National Career Fair in San Francisco.   (AP Photo/Eric Risberg)
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