Tape 89 - Economic component's effect on 1972
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- | Welcome once again as MIT Professor Paul Samuelson | 0:02 |
discusses the current economic scene. | 0:05 | |
- | This biweekly series is produced | 0:08 |
by Instructional Dynamics Incorporated | 0:09 | |
and was recorded November 15th, 1971. | 0:12 | |
We stand now exactly in the middle of the final quarter. | 0:19 | |
And I officially declare open the annual forecasting season. | 0:23 | |
This is a very good time to look ahead | 0:30 | |
because we will be a little bit ahead | 0:33 | |
of the published forecasts of the various | 0:37 | |
business economists of the various institutions. | 0:40 | |
The University of Michigan | 0:43 | |
is holding its outlook session this week. | 0:44 | |
The University of Pennsylvania computer model | 0:48 | |
will unveil its latest findings in a few days. | 0:51 | |
Every corporation economist is now drying ink | 0:57 | |
on his prognostications for the coming year | 1:02 | |
so that the chairman for the board | 1:05 | |
can take to his various finance committees | 1:08 | |
estimates of how the economy is going to do, | 1:12 | |
how the company's going to do, | 1:14 | |
so that investment plans can be made for next year. | 1:16 | |
It's especially appropriate that this subject | 1:23 | |
be discussed now | 1:26 | |
because we are going through in these very weeks | 1:27 | |
something of a failure of nerves. | 1:33 | |
The stock market not only has lost every bit that it gained | 1:35 | |
following upon the August 15th announcement | 1:39 | |
but it is now below where we were back on August 15th. | 1:42 | |
And there are plenty of people I can testify | 1:48 | |
from having been in New York just a couple of days ago, | 1:51 | |
that plenty of people are in New York | 1:54 | |
who are beginning to be frightened. | 1:56 | |
They are wondering whether all of the estimates | 1:59 | |
of the future could be wrong and whether | 2:02 | |
either because of the new price controls | 2:05 | |
and new wage controls or for other reasons more mysterious | 2:08 | |
as yet unseen we are not in for a new recession next year. | 2:12 | |
And let's make no mistake about it, | 2:17 | |
if we are in for a new recession so that this last expansion | 2:19 | |
has been one of the shortest and most anemic on record | 2:24 | |
then the stock market in declining more than 100 points | 2:28 | |
is only being rational and the end has not yet come. | 2:33 | |
I think on the whole, although I don't have as yet | 2:43 | |
a definitive forecast for next year, | 2:47 | |
I think on the whole the message which I can give today | 2:49 | |
will come to most listeners as an optimistic one, | 2:53 | |
as a reassuring one. | 2:58 | |
In all likelihood the standard forecasts | 3:03 | |
of the last couple of months that 1972 will be a year | 3:08 | |
of fairly strong increase, that real output will grow | 3:15 | |
in the neighborhood of 6%. | 3:19 | |
For this purpose let's not worry | 3:21 | |
about the difference between five and 6% | 3:24 | |
or six and 6 and 3/4%. | 3:27 | |
It seems to me that that is the most rationally founded | 3:30 | |
belief as I go over the pros and cons | 3:36 | |
in favor of strengthen the economy of that amount | 3:40 | |
and as you guessed it, weakness, | 3:45 | |
then the bulk of the evidence | 3:48 | |
seems to me to point in the direction | 3:51 | |
of that kind of strength. | 3:53 | |
That kind of strength does not mean | 3:56 | |
that the millennium will be upon us, | 3:58 | |
that we shall have arrived at bliss. | 4:01 | |
It does not mean that we shall have arrived | 4:03 | |
at 4% unemployment by election time. | 4:05 | |
It does not mean that inflation | 4:11 | |
will have been conquered | 4:13 | |
and a thing of the past. | 4:14 | |
But it does mean that the unemployment level | 4:17 | |
which was 5.8% at last recording in October | 4:21 | |
ought definitely to be somewhat lower, | 4:26 | |
it does mean that profits | 4:30 | |
which have been on the upswing ought definitely | 4:32 | |
to be better. | 4:36 | |
I reframe for the moment | 4:43 | |
of saying what it means with respect | 4:45 | |
to the rate of price inflation | 4:48 | |
that will be typical for the year 1972, | 4:51 | |
I mean the calendar year of 1972 as a whole | 4:54 | |
or what will be prevailing at the end of next year. | 4:56 | |
In the beginning let me give the argument | 5:02 | |
in favor of some strength | 5:04 | |
and this before any August 15th change in policy. | 5:07 | |
We are in the early part of a recovery. | 5:13 | |
It is true that the recession | 5:17 | |
from which this is a recovery | 5:20 | |
was not a sharp recession ending a V bottom | 5:22 | |
and so, it is not the case | 5:27 | |
that it is a rational expectation | 5:30 | |
that we should be on the rising part of the V | 5:33 | |
with strong upswing in the economy | 5:36 | |
and those of us who have said | 5:42 | |
that we must not expect the usual post-war first year | 5:45 | |
of expansion strength in the economy | 5:51 | |
have proved to be right | 5:53 | |
and there's reason to extrapolate | 5:55 | |
that same argument further. | 5:57 | |
But still it is an extraordinary period of expansion | 5:59 | |
which begins to show weakness | 6:05 | |
and a petering out of forces, | 6:07 | |
and no cumulation of forces | 6:09 | |
so early in the expansion. | 6:11 | |
That then is reason number one. | 6:16 | |
Reason number two is the calculation | 6:21 | |
of what has been happening to the fiscal budget generally. | 6:25 | |
What is the outlook for important components of GNP? | 6:30 | |
I'm going to take the view | 6:34 | |
for the moment just on a hypothetical base | 6:38 | |
that a good way of arriving | 6:41 | |
at the total of the GNP | 6:42 | |
is to build up its different components. | 6:44 | |
There are alternative philosophies in this matter | 6:46 | |
and it seems to me that there's no reason to be dogmatic | 6:49 | |
and to accept one philosophy eschewing all others, | 6:51 | |
let's apply each of the different philosophies | 6:56 | |
and if they give us the same result, | 6:59 | |
perhaps we'll have an extra feeling of reassurance | 7:01 | |
about that result | 7:04 | |
and where they will lead to differences in results, | 7:05 | |
it will be helpful to give a reasoned discussion | 7:09 | |
of how those differences ought to be evaluated. | 7:14 | |
While going to component by component, | 7:20 | |
there is no reason to think | 7:23 | |
that an ending of the Vietnam War | 7:25 | |
or some change in government fiscal policy | 7:29 | |
is going to cause a collapse in Federal expenditure. | 7:32 | |
We all begin in these forecasting exercises, | 7:39 | |
almost all of us | 7:41 | |
with some kind of an estimate of what's going to happen | 7:42 | |
to that excitement event, the budget. | 7:45 | |
I have to remind you | 7:49 | |
that this is an election year coming up. | 7:50 | |
I think it's naive to believe | 7:53 | |
that in elections years | 7:55 | |
everybody, the Treasury, the Federal Reserve | 7:58 | |
all conspire and conspire successfully | 8:01 | |
to create at least a temporary prosperity. | 8:04 | |
Maybe that sort of thing does happen | 8:08 | |
in a cabinet system of government | 8:11 | |
where the prime minister of England | 8:13 | |
is able to have parliament do his every bidding | 8:16 | |
but time and again in America, 1956 most recently | 8:19 | |
and 1960, even more recently | 8:26 | |
and going back a little bit earlier, | 8:30 | |
1948, these were all election years | 8:32 | |
and yet they were years of developing weakness | 8:35 | |
in the business or weakness just around the corner. | 8:40 | |
Still it would be naive not to realize | 8:44 | |
that President Nixon | 8:47 | |
has received the message of the November 1970 election | 8:49 | |
and that he has changed his posture | 8:53 | |
with respect to putting more steam | 8:59 | |
in the boiler, | 9:02 | |
so Federal Government expenditure looks | 9:04 | |
to be strong. | 9:07 | |
I want to emphasize this is not a budget out of control, | 9:08 | |
Congress is not adding to a budget | 9:11 | |
of the president which is already too large | 9:15 | |
but it is a supporting budget. | 9:18 | |
On the state and local level, | 9:21 | |
there has been a vast upswing in expenditures. | 9:23 | |
We know the needs of the states and localities | 9:27 | |
are very great and in the past, | 9:30 | |
this has been one of the steadiest time series | 9:33 | |
in the chart book to project forward | 9:35 | |
and so, we now proceed to do that. | 9:38 | |
Thirdly, construction expenditure | 9:42 | |
has been very strong this year. | 9:46 | |
Number of housing starts were expected to go up, | 9:49 | |
they have gone up, | 9:53 | |
there has been plentiful supplies | 9:54 | |
of materials to produce housing, | 9:58 | |
not I hasten to say at unchanged prices, | 10:01 | |
there are plentiful work teams | 10:05 | |
to produce the housing also | 10:08 | |
and there has been a fairly strong latent demand for housing | 10:11 | |
as measured by the smallest of the vacancy rate | 10:15 | |
by the housing needs of the people | 10:19 | |
and I wish to point out and to emphasize | 10:22 | |
a great deal of our single house dwellings today | 10:25 | |
are subsidized by the Federal Government | 10:29 | |
in one form or another. | 10:32 | |
There is reason therefore | 10:35 | |
to project into next year strong housing, | 10:37 | |
even a plus in comparison with the strong 1971 performance. | 10:41 | |
McGraw-Hill, FW Disen Company | 10:47 | |
has recently announced that people | 10:49 | |
have been bemused and haven't realized | 10:52 | |
quite the strengthen that there has been | 10:54 | |
in non-residential construction | 10:56 | |
and that has been fairly impressive | 11:00 | |
all this year and so, as we look into the next year, | 11:02 | |
I think we can expect non-residential construction also | 11:07 | |
to be strong. | 11:10 | |
We're just beginning to get the various surveys | 11:12 | |
of plant and equipment expenditure, | 11:15 | |
so-called fix investment, intentions of business | 11:17 | |
and I can report to you | 11:20 | |
that those are on the upside, | 11:22 | |
a lot of the leading organization has come in | 11:24 | |
with such a number, | 11:27 | |
the McGraw-Hill survey has shown that. | 11:29 | |
I think that we're about to get, | 11:33 | |
my memory is defective at the moment on this point, | 11:36 | |
a new official SEC Office of Business Economics forecast | 11:39 | |
and as I look through all the different regression equations | 11:45 | |
which have done well or badly in the past, | 11:49 | |
the consensus of them | 11:53 | |
is that both in real terms | 11:54 | |
and in money terms, | 11:58 | |
plant and equipment investment expenditure | 12:00 | |
will be up in 1972. | 12:03 | |
I should say that most regression equations | 12:06 | |
have had the unhappy faculty | 12:09 | |
in the recent period of underestimating | 12:11 | |
and that has been true right up | 12:14 | |
into the last couple of quarters. | 12:16 | |
Of course they underestimate in different degrees. | 12:19 | |
The best of these forecasting mechanisms | 12:22 | |
in terms of recent performance | 12:27 | |
and it's very dangerous to elevate any one method | 12:28 | |
above any other on the basis | 12:32 | |
of a little run of what might be just luck | 12:33 | |
is the FRBMIT, | 12:36 | |
that's the Federal Reserve Board | 12:39 | |
Massachusetts Institute of Technology model, | 12:40 | |
I guess University of Pennsylvania's involved in it | 12:43 | |
that is prominently associated | 12:46 | |
with the name of my distinguished colleague, | 12:49 | |
Fraenkel Mosilani and if we really give that model its head | 12:51 | |
and look into the next two years' future, | 12:56 | |
it only gives a high number for 1972 | 13:00 | |
but it also gives a high number for 1973. | 13:04 | |
We shouldn't count our 1973 chickens | 13:09 | |
until we've actually had a hatching | 13:11 | |
of the 1972 flock | 13:14 | |
because all these estimates build one year's numbers | 13:17 | |
very sensitively upon the previous year's numbers | 13:21 | |
and if the '72 estimates go wrong, | 13:25 | |
let's say that I'm grossly over optimistic | 13:27 | |
in my extrapolations, | 13:30 | |
then you can be sure that the 1973 estimate | 13:33 | |
will have also to be written down | 13:37 | |
and to be written down by even greater quantitative amount. | 13:39 | |
Nevertheless, the solid fact | 13:43 | |
such as they are show an improving plant | 13:49 | |
and equipment outlook. | 13:53 | |
I turn to the big item of the consumer. | 13:57 | |
To many people, it is the consumer | 14:01 | |
who has been the villain of the recent scenario, | 14:04 | |
at least he has not been the hero | 14:08 | |
because as it is said, | 14:10 | |
the savings ratio of the consumer, | 14:11 | |
the amount that he has withheld | 14:15 | |
from consumption spending | 14:20 | |
has tended in recent quarters to be high, | 14:22 | |
higher than might have been expected, | 14:26 | |
over 8% being saved | 14:28 | |
instead of as in so many earlier years, | 14:31 | |
five, 6% and of course, | 14:34 | |
each 1% change in the saving rate | 14:37 | |
based upon a disposal income of some $800 million | 14:43 | |
represents a eight to $12 billion change | 14:48 | |
in the volume of consumption spending. | 14:54 | |
Well, it's no secret that the consumer has been pessimistic. | 14:59 | |
All the different surveys of consumer attitudes | 15:02 | |
have shown a deterioration | 15:06 | |
of consumer attitudes. | 15:08 | |
This is associated with the recognition of the recession | 15:11 | |
which we had. | 15:16 | |
It's a recognition of the fact that this recession | 15:17 | |
involves middle-class people | 15:22 | |
who are articulate so that other middle-class people | 15:23 | |
are a little bit concerned. | 15:26 | |
I think it's a reflection of disquiet | 15:28 | |
in connection with the stubborn problem of inflation itself | 15:33 | |
and the foul mood of the consumer | 15:37 | |
may have something to do with the malays | 15:42 | |
which has affected our whole society | 15:44 | |
and which we see so acutely in connection | 15:46 | |
with arguments about the war | 15:49 | |
and the getting out of the war, | 15:52 | |
arguments about busing and civil rights | 15:54 | |
and minority problems, | 15:58 | |
arguments about law and order | 16:00 | |
and violence, problems of the counter culture | 16:03 | |
of the generation gap | 16:08 | |
of drugs, all these things it seems to me, | 16:10 | |
quite reasonably could be expected | 16:14 | |
to affect consumer mentality | 16:17 | |
particularly as that mentality expresses itself | 16:19 | |
in answer to questions. | 16:22 | |
For the first time, we have found in American life | 16:23 | |
that when a public opinion polster comes | 16:26 | |
to Americans and says how's the world? | 16:29 | |
He no longer gets the optimistic answer | 16:33 | |
that the world is great and getting better, | 16:35 | |
he now gets the ominous answer | 16:36 | |
that the world is in bad shape | 16:39 | |
and may well get worse. | 16:41 | |
Of course, he goes on to stay how is your private world, | 16:44 | |
how are you yourself doing? | 16:47 | |
He still gets on the whole a fairly optimistic answer | 16:49 | |
and this explains I think | 16:52 | |
why we've had so many houses purchased | 16:53 | |
and so much in the way of consumption | 16:57 | |
despite the aura of pessimism | 17:00 | |
which comes out from the consumer. | 17:03 | |
To turn to the tales of consumption, | 17:09 | |
because disposable income has been rising | 17:12 | |
so very, very rapidly this year, | 17:14 | |
transfer payments blowing up their items | 17:17 | |
of fiscal policy, | 17:20 | |
even the consumer has been maintaining a pretty high rate | 17:23 | |
of saving in proportion to disposal income, | 17:26 | |
he has been increasing the volume of his consumption | 17:28 | |
and so, retail sales have been doing quite well | 17:32 | |
and have been growing quite rapidly | 17:35 | |
in the period 1971, | 17:37 | |
we have no great reason to complain | 17:40 | |
on that score. | 17:42 | |
In particular, since the president's announcement | 17:45 | |
of August 15th with its bombshell | 17:49 | |
with respect to the automobile industry, | 17:52 | |
namely the repeal of the excise tax on automobiles, 7%, | 17:54 | |
now of course that's not a repeal | 17:59 | |
which is even as I speak yet on the books | 18:00 | |
and so, you've gotta pony up the money | 18:04 | |
when you buy a car form most dealers | 18:06 | |
and this involves more on your promissory note. | 18:09 | |
Nevertheless you've had the repeal of the excise, | 18:12 | |
you've had the whole, in case of some foreign cars | 18:16 | |
of being able to buy a foreign car | 18:19 | |
just before the 10% import surcharge goes into effect | 18:21 | |
because those in transit are not affected by it | 18:25 | |
and finally, because of the wage price freeze | 18:30 | |
which has just ended, | 18:35 | |
the 90 days is just over just behind us, | 18:38 | |
during that period you could have the nice feeling | 18:41 | |
that you're getting a 1972 car at 1971 prices | 18:45 | |
and this is the last chance to do so. | 18:49 | |
The balloon's going up | 18:51 | |
and you better get in there before the balloon goes up. | 18:52 | |
The result is that we've had a fabulous amount | 18:56 | |
of automobile sales, | 18:59 | |
the October more than one million sales | 19:00 | |
established an all-time record. | 19:04 | |
The best of retailing has perhaps | 19:08 | |
not been quite so strong, | 19:10 | |
it's been said that it's almost as if people | 19:12 | |
are putting their money into autos | 19:14 | |
and now are no longer having the rest | 19:16 | |
of their retail purchasing growing | 19:18 | |
and the usual alibis have come out | 19:22 | |
that this has been a warm autumn | 19:27 | |
which indeed it has in many parts of the country | 19:29 | |
and that's very bad for apparels sales. | 19:31 | |
Well, the warm autumn has finally come | 19:34 | |
to a more seasonal change | 19:37 | |
and as I speak of course, | 19:40 | |
we are on the threshold of the Christmas season. | 19:43 | |
Although we're in the middle of the fourth quarter, | 19:48 | |
we're really not in the middle of the fourth quarter | 19:50 | |
as far as retail is concerned. | 19:52 | |
We have so to speak 9/10 of the fourth quarter ahead of us | 19:54 | |
because of the strong seasonality | 19:58 | |
introduced in shopping expenditures | 19:59 | |
between Thanksgiving and Christmas. | 20:03 | |
Now I have to speculate about things unseen | 20:06 | |
because we don't yet have the Christmas sales | 20:10 | |
but it seems to me | 20:12 | |
that there are strong betting odds | 20:14 | |
that this is gonna be a very strong | 20:19 | |
Christmas shopping season. | 20:20 | |
Indeed, it's more important that I tell you | 20:24 | |
what's important to watch out for | 20:26 | |
than that I give you my vague guesses | 20:29 | |
about the future | 20:31 | |
and let me underline therefore | 20:33 | |
that if this should be a disappointing Christmas season | 20:36 | |
and notoriously disappointing, | 20:43 | |
that would be a very important strong wind | 20:45 | |
to tell us something | 20:48 | |
about the inherent strength in the economy | 20:49 | |
that underlies the situation as we go | 20:52 | |
into the New Year itself | 20:55 | |
but based upon all the evidence | 20:57 | |
which is at hand, it seems to me | 20:59 | |
that one should bet upon a good Christmas shopping season, | 21:01 | |
particularly since prices in phase two | 21:06 | |
will still be under the strongest control, | 21:09 | |
they're going to be in | 21:12 | |
because progressively with every month | 21:14 | |
that passes from now on, | 21:17 | |
it's going to be increasingly difficult I think | 21:19 | |
to hold down price increases | 21:21 | |
under the cost of living control mechanisms. | 21:24 | |
So, consumption ought to provide us | 21:29 | |
with some strength. | 21:33 | |
Now, we haven't touched upon the other item, | 21:38 | |
an important item is what's going to happen | 21:41 | |
to inventory behavior? | 21:44 | |
Was it Sherlock Holmes | 21:49 | |
who had the story where the remarkable thing | 21:53 | |
about the dog that didn't bark? | 21:56 | |
The remarkable thing about inventories | 21:58 | |
in the last several years | 22:00 | |
has been how inactive they have been | 22:04 | |
both on the upside and on the downside. | 22:07 | |
A student of the business cycles | 22:12 | |
who went away on a 20-year cruise | 22:15 | |
and came back to life | 22:18 | |
in just recent years | 22:20 | |
would not believe how much the American economy had changed. | 22:21 | |
Indeed that's the most important reason | 22:29 | |
for not believing in a very strong upswing | 22:31 | |
like that of earlier post-war upswings | 22:38 | |
because there's been no recent evidence | 22:42 | |
that inventory's gonna behave in that way. | 22:44 | |
Still, the best guess is that since inventory stocks | 22:46 | |
in relation to the sales | 22:51 | |
are not in a super abundant position, | 22:52 | |
maybe in some defense industries | 22:56 | |
that are logged down, there still is some overhang | 22:58 | |
but by and large inventories | 23:00 | |
have been kept in the fairly lean position. | 23:02 | |
It seems to me only reasonable | 23:04 | |
to expect that unless the other parts | 23:07 | |
of the forecast are way off base | 23:09 | |
that we will have | 23:12 | |
a fairly significant increased inventories, | 23:13 | |
let's say for the year 1972 as a whole, | 23:16 | |
I'm talking about the calendar year, | 23:20 | |
the fourth quarters that inventory accumulation | 23:21 | |
would be at something like the rate | 23:25 | |
of eight to $10 billion per year annual rate | 23:27 | |
in each of those quarters. | 23:31 | |
I guess that leaves us with a component | 23:36 | |
like the balance of payments, | 23:39 | |
that is the net exports in comparison with imports | 23:42 | |
including invisible items. | 23:47 | |
Some of the greatest errors of forecasting in 1971 | 23:50 | |
I should say were made on this item | 23:53 | |
because it has deteriorated | 23:57 | |
much worse than anybody had expected. | 23:58 | |
Most people expect that it will not be strong | 24:03 | |
but that it will not be as weak | 24:06 | |
as it turned out to be in 1971 | 24:08 | |
and I guess I have to go along with that | 24:11 | |
except that I am on the more pessimistic side | 24:13 | |
with respect to the degree of improvement. | 24:17 | |
Well, putting all those things together | 24:20 | |
by this method of argumentation, | 24:22 | |
it seems to me you come out | 24:26 | |
with some faith in the fashionable forecast. | 24:28 | |
My time is almost up. | 24:35 | |
Let me say that there is nothing in the monitorist way | 24:37 | |
of looking at the world | 24:42 | |
which it seems to me ought to work against this forecast. | 24:44 | |
We've had a very strong increase | 24:47 | |
in the rate of growth of the money supply | 24:49 | |
in the first part of the year up 'til August, | 24:51 | |
that's many months. | 24:54 | |
We have had a slowdown since that time | 24:56 | |
but that slowdown is not because of the desire | 25:00 | |
of the Federal Reserve to quench a boom | 25:04 | |
which has gone too far | 25:06 | |
and I see no reason to think | 25:08 | |
that if in the months to come | 25:10 | |
there should be a money shortage | 25:15 | |
with the Federal Reserve will refuse to provide | 25:17 | |
a positive rate of growth of the money supply | 25:22 | |
in the amount needed to make possible | 25:24 | |
these other estimates. | 25:27 | |
And last point. | 25:31 | |
What about confidence? | 25:34 | |
What about the fact that the stock market is down? | 25:36 | |
What about the fact that many trade unionists | 25:39 | |
do not like the controls | 25:43 | |
and some of them may soldier on the job, | 25:45 | |
some of them may go out on strike, | 25:48 | |
we would be in a period of industrial unrest | 25:50 | |
which would be very bad for productivity. | 25:52 | |
What about the fact that many businessmen are concerned | 25:55 | |
about their profit margines | 25:58 | |
under the price controls? | 25:59 | |
And what about the fact | 26:01 | |
that nobody likes uncertainty? | 26:03 | |
Not only does Wall Street not like uncertainty | 26:06 | |
and it's very hard on stock prices | 26:08 | |
but all these rosy plant, equipment investment plans | 26:10 | |
I've been telling you about, | 26:14 | |
of course are made by men | 26:15 | |
and they can be unmade by despairing pessimistic, | 26:17 | |
jittery uncertain men. | 26:21 | |
Some analysts, you would have heard some have said | 26:24 | |
that the August 15th wage price freeze | 26:27 | |
has been such a shock to business confidence | 26:30 | |
that there is a discernible weakness in the economy already, | 26:32 | |
probably those analysts think that will reverse itself | 26:37 | |
but they think that such a weakness | 26:40 | |
is in the picture. | 26:43 | |
I have surveyed very carefully | 26:45 | |
the evidence in the third quarter before August 15th | 26:47 | |
and the evidence after August 15th, | 26:50 | |
the evidence since this part of the quarter | 26:53 | |
and I cannot honestly say that excepting the stock market | 26:55 | |
there seems to be any factual warrant | 26:59 | |
for these assertions. | 27:03 | |
It was the last half of the third quarter | 27:06 | |
which by and large was stronger | 27:08 | |
than the first half in real | 27:10 | |
and in money volume items. | 27:14 | |
I conclude therefore | 27:18 | |
that in the weeks ahead, | 27:20 | |
we will have concrete, numerical forecasts | 27:22 | |
from different agencies, | 27:27 | |
from different forecasters | 27:30 | |
but my prediction is that they will be in the ballpark | 27:31 | |
that I have just been discussing | 27:35 | |
and if they are and even if they're not, | 27:36 | |
there will be a very useful task to be performed | 27:41 | |
in the weeks ahead as we go to the turn of the year | 27:43 | |
in evaluating how reliable these different forecasts | 27:46 | |
are likely to be | 27:51 | |
and what's very important | 27:52 | |
in giving a reasoned discussion of the directions | 27:53 | |
in which they might go wrong | 27:57 | |
with some indication | 27:59 | |
of how large those probabilities may be | 28:01 | |
of going long on the upside | 28:04 | |
or going wrong on the downside. | 28:05 | |
- | If you have questions or commments | 28:07 |
for Professor Samuelson, | 28:08 | |
should be addressed to Instructional Dynamics Incorporated, | 28:09 | |
166 East Superior Street, Chicago, Illinois, 60611. | 28:12 |
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