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Yesterday I wrote a post noting that the coming GDP numbers were thought to be worse than both the administration's numbers, which included the stimulus's effects, and the CBO numbers, which did not included the stimulus and were thus more pessimistic. Now, I wrote, administration sources were saying that the stimulus would have a positive impact but the situation had deteriorated so quickly that even the pre-stimulus CBO estimates seemed optimistic. Today, Noam Scheiber says that Goldman Sachs's predictions say much the same thing:
A plugged-in source points me to Goldman's latest economic forecast, which anticipates -7% GDP growth this quarter and -3% GDP growth next quarter, down from an earlier forecast of -4.5% and -1%, respectively. What's remarkable about the change, though, is that the new numbers factor in the stimulus, whose effects Goldman thinks will be significant (and positive), whereas the old forecast didn't. And yet they still have the economy contracting by much more than previously thought. Kind of gives you an idea of what we're up against...On the bright side, says Scheiber, "they do see us back in positive territory by the summer." At least, they say that now. Indeed, Corey, writing in the comments to yesterday's post, summed up my feelings well. "There are two guys, an optimist and a pessimist. The pessimist says, 'Things can't get any worse.' The optimist turns to him and says 'Oh yes they can!'"Increasingly, I'm an optimist.
