Atlas shrugged? Manufacturing seems worn out WAS

Atlas shrugged? Manufacturing seems worn out
WASHINGTON (MarketWatch) — There are signs that the manufacturing sector, which has led the economic recovery, is about to take a breather.

“It seems like the [factory] sector is stuck in neutral,” said Guy Berger, an economist at RBS in New York.

Several factors appear to be at work, economists said.
Weakness in the global economy is cutting back exports. And factory owners are uncertain about how the outcome of the November election and what it means for taxes and government largesse.

“Japan is going nowhere, Europe is in recession, and we’ve got our own problems,” such as stalemate over tax policy and government spending, said Josh Shapiro, chief U.S. economist with MFR Inc.

Shapiro is concerned that there are no obvious heirs-apparent waiting in the wings to pick up the slack and propel the economy forward.

Housing seems to finally in recovery mode but it seems doubtful it can pick up the load.

Without an obvious source of strength, Shapiro sees a 50% chance of a recession in the next 12 months.

“I think things are more dangerous than a lot of other economists think,” Shapiro said.

Another economist forecasting a high probability of a recession in the next year is Chad Moutray, chief economist for the National Association of Manufacturers, the trade group for the factory sector.
http://www.marketwatch.com/story/atlas-shrugg...2012-08-19