The March 2013 Wall Street Journal Economic Forecast Survey

The March Wall Street Journal Economic Forecast Survey was published on March 18, 2013.  The headline is “Easy Money Era a Long Game for Fed.”

Although I don’t agree with various aspects of the survey’s contents, I found numerous items to be notable, both within the article and in the Q&A found in the spreadsheet.

Notable excerpts from the article include:

According to the economists surveyed, circle these dates on your calendar: November 2013, May 2014 and June 2015. That is when on average they expect the Fed, respectively, to:

1) start slowing its monthly bond purchases,

2) stop buying bonds, and

3) begin thinking seriously about raising short-term interest rates, as unemployment reaches 6.5%.


Economists surveyed by the Journal, on average, said they didn’t expect the Fed’s balance sheet to return to normal—not bloated with the many extra bonds purchased in its quantitative-easing programs—until December 2019. More than a decade after the financial crisis ended, in other words, the Fed might still be a big player in long-term bond markets, directly shaping long-term rates.


They also said markets weren’t overheating, despite a recent run of stock-market highs; on a scale of 0 to 10, they said froth in markets was about a 5.

As well, as to the question (seen in the spreadsheet detail) “Please estimate on a scale of 0 to 100 the probability of a recession in the U.S. in the next 12 months,” the average was 15%.

The current average forecasts among economists polled include the following:


full-year 2013:  2.3%

full-year 2014:  2.9%

full-year 2015:  3.0%

Unemployment Rate:

December 2013: 7.4%

December 2014: 6.8%

December 2015: 6.2%

10-Year Treasury Yield:

December 2013: 2.41%

December 2014: 3.04%

December 2015: 3.61%


December 2013:  2.1%

December 2014:  2.2%

December 2015:  2.4%

Crude Oil  ($ per bbl):

for 12/31/2013: $94.94

for 12/31/2014: $93.10

(note: I highlight this WSJ Economic Forecast survey each month; commentary on past surveys can be found under the “Economic Forecasts” category)


I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this blog are aware, I do not necessarily agree with many of the consensus estimates and much of the commentary in these forecast surveys.


The Special Note summarizes my overall thoughts about our economic situation

SPX at 1552.10 as this post is written