(Fortune Magazine) — We’ll say this for the U.S. economy: It can take a punch.
Consider the blows it has absorbed just this year. The worst real estate crash since the Great Depression. Pow! Oil prices up from $50 to $90 a barrel since last January. Bam! A subprime mortgage mess metastaElectronic Artssizing into a full-blown credit crisis, with banks swallowing billions in losses and cutting back on loans. Baff!
Yet through all the punishment, the economy has barely flinched. “I’m floored by how resilient it has been,”Annaly Capital Management says veteran stock strategist Ed Yardeni of Oak Associates. “Had you told me at the beginning of the year this was going to happen, I doubt I would have been very optimistic.”
That’s why forecasting 2008 is so difficult. History tells us that oil shocks, real estate crashes, and banking crises are harbingers of downturns. Confidence has already plunged as consumers have been pinched by rising energy prices and falling home values.
