The September 2012 Wall Street Journal Economic Forecast Survey

The September Wall Street Journal Economic Forecast Survey was published on September 13, 2012.  The headline is “Economists Are Uncertain More Fed Moves Will Work.”

The commentary largely focuses on what impact another round of large-scale asset purchases would have on the economy.

An excerpt:

The forecasters didn't see big benefits from a new Fed bond-buying program. Private-sector economists, asked about the impact of a hypothetical bond-buying program of $500 billion, on average estimated it would reduce the unemployment rate by only 0.1 percentage point over a year. The jobless rate was 8.1% in August. They also projected such a program would increase annual economic output, or gross domestic product, by 0.2%.

In the Q&A section (in the spreadsheet), there was this question: “Is the risk to your 2012 growth forecast more to the upside or downside?” to which 84% indicated “downside” and 16% “upside.”

Also in the Q&A section, there was the this question: “Please estimate on a scale of 0 to 100 the probability of a recession in the U.S. in the next 12 months.”  The responses averaged 22%.

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The current average forecasts among economists polled include the following:

GDP:

full-year 2012:  1.9%

full-year 2013:  2.4%

full-year 2014:  2.9%

Unemployment Rate:

December 2012: 8.1%

December 2013: 7.7%

December 2014:  7.1%

10-Year Treasury Yield:

December 2012: 1.83%

December 2013: 2.53%

December 2014:  3.18%

CPI:

December 2012:  1.9%

December 2013:  2.2%

December 2014:  2.4%

Crude Oil  ($ per bbl):

for 12/31/2012: $94.11

for 12/31/2013: $95.31

(note: I highlight this WSJ Economic Forecast survey each month; commentary on past surveys can be found under the “Economic Forecasts” label)

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I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with many of the consensus estimates and much of the commentary in these forecast surveys.

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 1459.99 as this post is written