The Global Economic Outlook Is as Clear as Mud

The debate about whether the world’s largest economy is in a recession, or headed for a recession, or sufficiently robust to avoid a recession, just got even more complicated. Friday’s US employment report showed total payrolls at a record high, with companies adding twice as many workers as economists forecast. “Job gains in July were a monster,” notes Jason Schenker of Prestige Economics.

Google Trends may offer a better real-time guide to whether the economy is contracting than any official judgment from the National Bureau of Economic Research, the group that documents business cycles. Lags in data, as well as revisions, delay its pronouncements. For Gary Shilling, there’s a sufficiently high correlation between waning consumer confidence and appearances of the word “recession” in internet searches to settle the argument.

Rising energy prices, increased mortgage costs, excess retail inventories and a bursting housing market bubble all…

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