Reading Tea Leaves

After last year’s sudden and dramatic wrecking of the world’s economies, the sterling perception of economic theory has become severely tarnished. Despite this fall from grace, some economists have lately been talking of the signs of a nascent recovery. Admittedly, reading the tea leaves to make prognostications like these is not a simple task. While the notion of an economic bottom either being here or being near is growing more prevalent in the media, the questions of whether or not any bottom will hold or if a new, even lower one replace it remain unanswered. Hence, moderate skepticism of statements that a recovery is beginning seems reasonable especially when the outlook comes from a discipline that did not see last year’s disaster coming.