The past four years have been dismal for the dismal science. After mostly failing to predict the largest economic crash since the Great Depression, economists have responded by repeatedly failing to anticipate shifts in the major economic indicators—like the unrealized predictions of a strong recovery in 2010 and the upswing of the past few months, which has outperformed expectations by a sizable margin.
Now that the recovery is gathering steam and smart forecasters are beginning to bet on robust growth this year, we hate to be the bearers of bad news to confuse the economists’ prognostications: Retail sales have dropped over the past few months and gas prices have risen, according to the Wall Street Journal. Rising gas prices and falling gas consumption are never good for an economy. Combined with the sour consumer spending news and Europe’s ongoing cliff-teetering, they could knock the recovery flat on its back.
We’re not out of the woods yet.