I think of a Muddle Through Economy as around 2% growth. That is enough to keep things going forward, but not enough to substantially dig into unemployment or raise incomes. The entire last decade was a Muddle Through decade, with growth averaging 1.9%. After I wrote about a Muddle Through decade at the beginning of the last one (in 2002), I caught some flack during the middle years of the decade. Turns out to have been a pretty good call, though. I still think we are in for a repeat, over the coming decade, of slower growth on average than we would like, but not this year.
---John Mauldin 1/8/11 Newsletter
Bill: I don't agree with him about this year, although I agree with him about this decade. He says in the letter that he expects 2.5% to 3% this year. Hardly great. But to get above 2, he basically relies on the generally debunked "good" jobs report from December. (Rosenberg as usual does the best such debunking) (free login required). My take on the markets, as previously stated, is uppish into mid year, then down. Same-o with the economy. And that's without any exogenous shocks. So we may get 3+% in Q1 or Q2, but not much in Q3/4. If I'm wrong, by then, you will all have forgotten. (joke).