U.S. Recession Over Before It Began.
stratfor.com
November 14, 2001
The latest economic data show the United States was on its way to a robust recovery before the Sept. 11 strikes. The economy is in the midst of a major rebound this quarter and will continue strong growth in 2002.
Northern Alliance troops poured into the Afghan capital of Kabul Nov. 13, igniting optimism that the war against the Taliban will end quickly and the U.S. economy can get back to making money. But despite the conventional wisdom that the United States is close to or in a recession, evidence shows that a major recovery is already underway.
Analysis
Since the Sept. 11 attacks, the U.S. media has popularized the notion that the country is in or on the brink of recession. Such hysteria is somewhat understandable, given that the destruction of the world's largest commercial space, the temporary suspension of much of the U.S. transportation network and the evisceration of consumer and business confidence have had a very real economic impact.
But the situation is not nearly as dire as the public has been led to believe. Although many of the most optimistic pundits pegged a U.S. recovery to next year, close scrutiny of the numbers shows the so-called "recession" is over. The economy is already in the midst of a major recovery this quarter, with continued strong growth to occur in 2002.
U.S. gross domestic product contracted only 0.4 percent in the third quarter this year, far less than what many, including STRATFOR, were expecting. When the depth of the terrorist attacks and the relative strength of the GDP figure are compared, it becomes apparent that the United States was well into a robust recovery before the strikes. |
