Statement on the Economy

A word of caution to President Obama's critics:   American families and businesses may be finally recovering from the economic beatings they suffered in the 2008 financial crisis and the extended unwinding of the 2002-2007 housing bubble.  The giant payroll company ADP, whose surveys have a good record of anticipating the official jobs reports, said today that private sector employment grew by an estimated 325,000 in December.  This follows several months of encouraging news on jobs from the Bureau of Labor Statistics.   Business investment and corporate profits also have shown renewed strength.   

Yet, GDP growth has been modest, mainly because consumer spending is still fragile.   Americans want proof that job creation is back and the value of their homes has stabilized.  The first factor may now be in place.   If housing prices stop falling - and Europe avoids a financial meltdown -- the American economy in 2012 is likely to be the strongest since 2007.