Even pessimistic forecasts see bright spots on the horizon
California Lutheran University economist Bill Watkins is not going to win any prince of light awards this year.
But the normally pessimistic forecaster has a few glimmers of daylight in his latest state and national prediction. For the first time, Watkins sees a turnaround in California’s economy — but it’s weak and it will only happen late next year.
He’s also raised his forecast for the national economy to reflect anemic GDP growth, but growth nontheless, in the last three quarters of 2010. That’s after a slight dip in the first quarter.
Watkins’ forecast continues to lag others, including a consensus forecast that now has the U.S. economy growing at 3 percent next year, up sharply from the 2 percent consensus of just a few months ago.
The bottom line is that economists may disagree about the pace of growth, but it’s clear the national recession has ended and that California, though behind, is slowly beginning to emerge from a steep downdraft.
The budget fight will be ugly, default on debt looms, and there are other hazards ahead.
But if Watkins is raising his forecast, it’s a good thing.
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