For over 30 years, Gary D. Halbert has been publishing newsletters for the investment community. Now you can receive his FREE Forecasts & Trends E-Letter delivered each week to your e-mail inbox. Gary covers the latest economic forecasts and market analysis, and you'll enjoy his always-spirited political commentaries.

This Week's Forecasts & Trends E-Letter

Economists Expect Big Jump In 2Q GDP - We’ll See

May 16, 2017

For reasons that are not yet clear to me, a growing number of economists and forecasters are predicting a big jump in the economy in the current April-June quarter. Some are expecting 2Q GDP to rise by 3.0-3.5%. I’m not sure why, but that’s what we’ll focus on today.

You will recall that the economy disappointed badly in the 1Q with anemic growth of only 0.7% (annual rate) according to the Commerce Department. I should point out that the Commerce Department has under-estimated GDP growth in the 1Q for a number of years now. Yet remember that for all of 2016, the economy grew by only 1.6%.

You may also recall that the US economy failed to grow by 3% in a single year during the eight years of President Obama. This hasn’t happened in decades. Yet forecasters are increasingly telling us that GDP growth will somehow surge to 3.0-3.5% in the current quarter. I don’t buy it.

Nonetheless, I will summarize the positive thinking regarding a big jump in the economy for you in the pages that follow, and then you can decide if you are buying into this newfound optimism, or if you remain skeptical as I am.

Don’t get me wrong, I sincerely hope that the US economy is about to leap ahead. I just don’t see it in the numbers so far. I’ll begin by summarizing the positive outlook of a widely-followed forecaster. Let’s get started.

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