Waiting For Recovery

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"Is it coming'"
"Yes, it's coming."

Apologies to Sam Beckett for the ugly paraphrase — I don't actually have a copy of Waiting for Godot in front of me — but I can't resist the comparison: Vladimir and Estragon as an economist and an investor, waiting for the Recovery that is due any minute now but, maddeningly, keeps declining to show up.

I don't know that this bothers the economists much. The "dismal science," which is at least one-quarter art, doesn't deal much in certainties, and I figure for most folks in the forecasting game, the longer the recovery takes to show up, the more time it gives them to revise, revise, revise, until their last forecast happens to be just right.

But it's starting to bother the investors. The rally that started steaming up from the depths Sept. 21 has run out of steam the past week or so, in large part because the stock-slingers can't figure out when these companies are going to start turning profits again. They know as well as anyone that economic forecasts are mainly parlor games, and not only are they guaranteed not to be all right, quite often they're all wrong. But they can't be sure of much else, so they're just standing around, waiting. What else can they do?

And it's starting to bother me. Not the mystery of the recovery so much — we'll get to that in a minute — but the waiting. The chronicling, week in and week out, of this scrap of economic evidence and trying, with a straight face, to extrapolate two or three month-old points into a linear forecast of my own.

Sometimes it all seems so hopeless. Yes, I realize that the rise by 0.3 percent of, say, industrial capacity utilization in the manufacturing sector is theoretically a useful statistic, that the economic gods have deemed it illuminating in past chartings of the business cycle, and thus it must be illuminating this time too. But in a $10 trillion economy, with a million different capacity utilizers (or non-utilizers, as the case may be) moving at their own pace, in their own sector, for their own customers, sometimes I wonder if it's telling us anything at all.

Think of how a recovery has to work. Before businesses will shell out to produce new goods (or new ways of producing new goods) they have to be confident about turning a profit from healthy consumer demand. Of course, before consumers will shop, they have to be confident about their jobs, their retirement and their wallets. But the businesses waiting for demand keep firing employees/shoppers while they wait. And the vicious cycle of Mexican standoffs starts anew.

All of which leaves Vladimir the economist and Estragon the investor to stand around waiting for two hopelessly interconnected groups to reverse each others' fortunes. It's not that consumers and producers won't get in sync eventually — recoveries are as inevitable as recessions — it's just that economy-watchers having a hell of a time figuring out exactly when. Which, of course, is our job. To wait for Recovery, babbling aimlessly about him all the while, and then to spot him before he even shows up. They're generally wrong. I'm generally wrong. Yet we'll all be right eventually, if we revise often enough.

Talk about absurdist drama — Beckett, at least, had the good taste to stop writing before Godot got there and didn't live up to Wall Street's expectations. The rest of us professionals (forgive the vanity) have to keep going, keep asking the same questions again and again, or we'll be pushing up unemployment numbers by New Year's. (So, job market tough enough for ya?)

E: "Why don't we hang ourselves?"
V: "With what?"
E: "You haven't got a bit of rope?"
V: "No."
E: "Then we can't."

But he's definitely coming, right?
Definitely. Second half of 2002. I swear.