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Non-Tech : Kirk's Market Thoughts -- Ignore unavailable to you. Want to Upgrade?

To: Gottfried who wrote (656)	2/11/2014 3:49:57 PM
From: Kirk ©	Respond to of 26439

LOL @ "just fine"! Great article. 3.3% growth is goldilocks since high inflation comes from wage growth when companies have to give huge pay raises to keep and/or attract workers when economies grow at 5% or so... And the pieces of the puzzle so far are telling O’Sullivan that the economy will probably grow at a 3.3% pace this year, up from the 2.7% growth recorded from the end of 2012 to the end of 2013. I liked this part Here’s how he builds that spending forecast: With total hours worked rising at 2%, and hourly wages up about 2%, nominal labor compensation is rising at about a 4% annual rate. Subtract the 1.5% inflation, and you get real earned income growth of about 2.5%. Factor in a little bit of spending due to the wealth effect and you could easily see 3% growth in consumption, particularly if wages begin to rise a little faster as the labor market tightens. O’Sullivan believes the Bureau of Economic Analysis may have undercounted consumption in 2013. Spending, especially on services, is hard to track in real time, but income is relatively easy to measure.