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For Pessimists, Worries Die Hard

Despite the optimism abounding about the U.S. recovery, there are still economic bears around these parts.

An increasingly small but nonetheless vocal band of economists argue there are ample reasons to worry about the economy. The strength of recent data, most notably on the hiring and inflation fronts, has made their position seem increasingly beleaguered. Even so, the choppy experience of the last several years suggests it would be imprudent to count out the worst-case scenario.

Those who worry about the outlook - the bears - have little problem with the idea that the economy will perform strongly over the next few months, as it did during the second half of last year. Yet when they look at the interest rate outlook and the diminished stimulus coming from government spending, along with concerns that some of the recent robust trend may not be sustained, they're finding plenty to worry about...

Speaking Friday at a conference at Bard College, in upstate New York, Lakshman Achuthan, of the Economic Cycle Research Institute, fretted about exactly those sorts of "non-cyclical" changes. While he's ultimately optimistic about the U.S.'s ability to remain at the top of the global economic heap, "nothing short of a seachange is going on" in terms of the nature of employment. Changes in the global economic system and the increased ability of companies to outsource jobs abroad will cause major ripples in hiring, which will in turn complicate efforts to forecast the outlook for employment, he said...