Thursday, October 13, 2005

John Makin from the AEI

publishes his Economic Outlook for October.

"More broadly, the loss in growth momentum that appeared during August (prior to Katrina) probably reflected an underlying tension in the U.S. economy. A 1 percentage point growth drag from persistent increases in energy prices has been offset by a 1 percent growth boost from household equity extraction out of the housing sector that, in turn, helped to support consumption. As energy prices have continued to rise and activity and prices in the housing sector have weakened, the net effect has been slower growth."

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