Experts estimate so-called budget sequestration could cost the country about 700,000 jobs, but Wall Street doesn’t expect the cuts to substantially alter corporate profits or threaten stock markets
Consider the dominant story that economic forecasters have been telling you for years now: The U.S. economy just can’t catch a break. It has been poised time and again to rocket back to a growth rate that would recapture all the ground lost in the Great Recession, while delivering big job gains. But every time, some outside event scuttles things. The euro crisis flares up. A Japanese tsunami scrambles global supply chains. Lawmakers play chicken with the federal debt limit.
Most recently, “fiscal cliff” tax hikes and sequestration budget cuts are playing the culprit. And the bad-luck economy, like a fireball pitching prospect dogged by freak arm injuries, never reaches its full potential.
Now consider the possibility that the can’t-catch-a-break story gets it backward. […]
What if this slow and fragile expansion is as good as we’re likely to get for a while?