Wishful thinking cum confirmation bias

According to Market Insider: “Jobs bombshell raises questions of new weakness”:

August’s nonfarm payrolls growth of just 142,000 raises concerns that the economy is healing unevenly, but economists say the stunningly weak jobs report could be just a temporary setback in a stronger trend.

“I don’t believe it. … You can’t predict a weak number, but August tends to be weak consistently, and it tends to get revised up consistently,” said Mark Zandi, chief economist at Moody’s Analytics. “I think the trend is still north of 200,000. Every other data point is pointing to stronger growth, not weaker growth.”

That´s a mixture of wishful thinking and confirmation bias. The fact is that for the past three or four years the economy has been on a mediocre “even keel”. Mediocre in the sense that it hasn´t bothered to recoup almost anything from the losses of 2008-09.

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And if “every other data point is pointing to stronger growth” why is the long term bond yield not reflecting expectations of either growth or inflation?

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One thought on “Wishful thinking cum confirmation bias

  1. With each passing year, American economist seem to accept lower rates of real growth, yet insist on even lower rates of inflation.
    The United States of Japan?

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