Curious as to why you think the economic condition is ok? The FED seems to disagree as they just announced holding interest rates near 0 until 2013. Added to that - many firms (ie MS) are cutting GDP predictions just not for the US, but the world.
And the outlook by companies this qtr were very mixed and earnings projections are getting cut. I would say odds for another dip in the ongoing Depression are increasing daily.
"Curious as to why you think the economic condition is ok?"
Imo, we're going to see 1% to 2% growth until housing recovers. I think double dip is unlikely even with the unbelievable fear being created by the media. Of course, it does not help our economy to give the tea party folks credibility. Implement their policies and this country will end up in a new great depression.
1. Annual Worldwide and US population are increasing 2% and 1% respectively.
2. Balance sheets of consumers and corporate America are vastly improved since Lehman. Corporate cash will start to approproach $2 trillion over the next couple of years. Consumers delinquencies will hit record lows which will drive bank earnings to all time record highs. BB lastest move will result in large mortgage refinancing this quarter which will continue to improvement consumer's balance sheets.
3. Automotive spending and capex are still running well below trend line. US car and light truck production will hit 12.6 million vehicles in 2011 but that's still only about 70% of trend line.
4. US multinationals are doing incredibly well thanks to Asian growth which will largely drive modest real personal income growth in the US.
Yes, there are a host of problems. Obama has screwed up by failing to define problems so his solutions are off target. Obama did not create this mess. The real culprits are Greenspan, Bush, Congress and the rating agencies. Maybe his attempt to create a public private residential trust will improve housing prices and get that part of the economy growing again. John Allison, you may recall, suggested this 3 years ago.
Based on what I've read I think his job plan is off target. Yes, improving roads, bridges and schools are important but we need to pay for them. No better way to pay for them by converting 50% of our transporation fleet to natural gas and get off foreign oil. Our trade deficit is around $600 billion or 4% of gdp. Boone Pickens has a great plan but it has fallen on deaf ears to date.
And lastly the deficit solution is simple. Stop screwing around. Implement Simpson - Bowles. Why Obama is trying to re-invent the wheel is a mystery. It's his own commission.
There are still hundreds of trillions of derivatives floating in the financial system worldwide. The resolution to this has not even begun and until the finacial system is flushed of these toxic assets there is not much chance of any substantial improvement in the economy.
Personal balance sheet improvement is due primarily to defaults on mortgages and unsecured debt - not because people have changed their behavior. When you see a company like AAPL selling millions and millions of Iphones and Ipads that satisfy wants (not needs) you can be sure there has been no real change in consumer habits.
As to a double dip - who said anything about a double dip? We are in a Depression and have been for the past 3+ years. Anemic improvement in GDP may meet the statistical definition of being out of a recession, but when you have something like 16-17% unemployment (when you count the discouraged and under employed) you are so far down that a recession appears to be up.
This is not a problem caused over the last 8-10 years (by Bush, Greenspan, et al) this is a problem that has developed over 40-50 years as more and more government social programs promised more and more. And this is not just a US problem - it is a world wide problem. The day of reckoning is here and it will not be cured in any short period of time. So blaming any one politician (Obama) or any one group (Tea Part) is futile.
I reccomend everyone do some research and reading about long term economic cycles. The last long cycle bottom was 1949-52 and the next one is due 2012-2015 (and believe me the Fed knows this and knows the most they can do is delay it a bit not stop it).