6% Unemployment 3 years away?

Ben Bernanke thinks so, and that’s if Congress makes sure not to cut spending.

Or so CNBC reports anyway.

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  • fche

    His predictive prowess is the stuff of legend.

  • http://www.deanesmay.com Dean Esmay


  • Scott

    How does he measure unemployment? There are many ways…

  • maggie – labrat

    Yeah and we are not in a deep recession now either, all the businesses closing in my area are a figment of my imagination.

  • Paul S.

    Bernanke and the rest of the Fed have much more data than any of us when they form these guesses, but they are still guesses. (Bernanke refers to it as his “reasonable guess” in the linked article.) For whatever reason, people get this false sense of precision when it comes to forecasting in economics and finance, probably because it involves math and numbers.

    Implicit in Bernanke’s guess is that, over the next 3 years, we will avoid recession in the US and China, Europe (which is already in recession) will not blow up, and that the Middle East will stay reasonably stable, or at least oil prices will. It is certainly possible that this will all happen, maybe even better than 50/50 that it will, but no one can predict the future, and it’s not out of the question that things look dramatically worse in 3 years. Who would have predicted that a guy pushing a cart in Tunisia could immolate himself in protest and spark a chain of events leading to the takedown of Mubarak, Khadaffi, and hopefully Assad?

    So let’s hope Bernanke’s guess turns out to be right, and also realize the context, 2016 means 9 or so years since the unemployment lows in mid 2007 of 4.4%. Ouch! That is a long recovery, but not unprecedented, particularly given the structural nature of the recession.

    Scott – I think you are being rhetorical (and it makes a fair point), but in case you are not, he is referring to headline employment.

  • http://madisonforum.net/ Sandi

    Far more important than Bernanke’s guess is what he is actually doing. He is printing $86 billion her month in bogus money into the foreseeable future.

    The negative results of the money flood is a dollar that is worth less, higher oil prices, higher prices on all goods. On the positive side it keeps the stock market in rising in good shape.

  • Scott

    Paul S.- We’d all be better if that Tunisian cart-pusher hadn’t immolated himself. We and the Egyptians are worse off without that monster Mubarak than with him. Surprising as that is.

    Meet the new Boss worse than the old Boss.