CalculatedRisk•
Fed's Beige Book showed the "economy continued to improve":
Reports from the twelve Federal Reserve Districts indicate that the economy continued to improve, on balance, during the reporting period from early/mid-October to mid-November.
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Manufacturing activity continued to expand in almost all Districts, with relatively strong growth seen in metal fabrication and the automotive industries.
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Housing markets remain depressed, with several Districts reporting further weakening during the past six weeks.
• In a research note today, "A Brighter US Economic Outlook", Goldman Sachs upped their 2011 real GDP forecast (this is the first time their outlook is above consensus in five years):
We have raised our sights for 2011, calling for real GDP growth to average 2.7% for the year versus 2.0% previously. We expect growth to pick up further in 2012—to 3.6% on average for the year—though judgments that far out are clearly tentative. ... Although our revised outlook implies a meaningful drop in the jobless rate, it will remain high by historical standards, ending 2012 at about 8½%.
On the conference call, Goldman highlighted several downside risks: Spillover from Europe, falling housing prices and possible premature fiscal tightening.
Note: I took the "over" during the weekend:
The recent improvement in economic news. This forecast is still for sluggish growth and the unemployment rate is unacceptably high.
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Let's see if President Obama can do more to further brighten the outlook.