Here’s a word that should be eliminated from today’s coverage of the economy: “unexpectedly.”
Here are a few of many recent examples from prominent news outlets.
Sales of new homes unexpectedly sank 12.4 percent in July to the lowest point since government records starting being kept in 1963.
Home resales dropped a record 27.2 percent in July -- nearly twice as much as analysts had expected.
Initial claims for unemployment surged unexpectedly two weeks ago to more than 500,000 and fell more than expected last week to 473,000.
The question is, of course, unexpected to whom?
Certainly among employers there is nothing surprising about these weak numbers. With some notable and worthy exceptions, employers are on strike against hiring as they attempt to navigate the unsettled economy ahead of them.
And the 18.4 percent of formerly working Americans who are out of a job, working only part-time or have quit looking altogether surely see nothing unexpected in the figures.
And many knew weeks or months ago that housing sales would slow markedly when the federal government stopped paying people to buy houses with the expiration of the $8,000 tax credit.
Now, at least, we may know the true state of the housing market and move on.
But more importantly, this inability to properly assess the state of the economy can be dangerous. For instance, with the weakening in the labor market, housing and manufacturing already documented, second-quarter economic growth will almost assuredly be revised downward.
Beacon Economics economist Christopher Thornberg at the recent Business Journal Impact Napa conference said that figure will likely be revised to 1.3 percent from 2.2 percent. That will be no surprise to Dr. Thornberg and anyone who is paying attention.
But if it is played as a surprise or something unexpected and more reason for worry, the financial markets could react negatively, further damaging confidence and Americans’ retirement portfolios.
That’s would be unfortunate, and we should expect better.