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U.S. Economic Outlook

The economy is great. Wait, it stinks. Uhh. Scratch that.

Fact is, it's tougher than ever to know for sure. The euphoria surrounding the blockbuster October jobs report earlier this month has quickly faded and has been replaced by concerns about the weakening dollar and rising oil prices.

And now investors, who bid up shares sharply before and after the Presidential election, are threatening to take back the gains...

So have conditions really taken a drastic turn for the worse in just two weeks or is the market being overly skittish?

Several Wall Street watchers think that things aren't nearly as bad as they seem. But many of the same observers also caution that the economy isn't exactly in fantastic shape either.

"We're not in trouble. But at the same time it's quite clear that there is no sign of a sustained pickup in growth in sight," said Anirvan Banerji, director of Research of the Economic Cycle Research Institute. "Our conclusion is don't worry, don't be happy."

The blah economy

Along those lines, Banerji said that fears about relatively high oil prices possibly putting a dent in consumer spending are a bit overblown. But he said the greenback's slide is particularly worrisome because it has sparked fears of inflation.

As the dollar weakens, it makes the price of imported goods more expensive. And if inflation picks up, one way the Federal Reserve might combat it is by raising interest rates.