I have written before about the work of Professor Robert Gordon and others, who are projecting much lower growth in the next hundred years than in the past. The rationale, briefly, is that all of the easy gains have been taken. The world will not be electrified again. Agriculture has already been largely mechanized. Labor-saving inventions, like the washing machine, have already fully penetrated the developed nations and are working their way through the emerging markets. At some point in the not-too-distant future, it will be possible to satisfy people’s material needs fully.

With population growth topping out, as it is, and with material needs on their way to being addressed, will growth even be necessary? Imagine a world with a stable population, where everyone has enough material goods—what growth would we need? What would growth even mean in that context? Even if Gordon was right, would it matter?

When Janet Yellen testifies to Congress for the first time as chair of the Federal Reserve, she will have a very unusual second chance to make a first impression.

One of the more interesting ads in a generally disappointing Super Bowl—I know I wasn’t the only one looking forward to a much more exciting confrontation between the number-one offense and the number-one defense—was the puppet-maker who supposedly quit her job on national TV. I have to say, if it was real, it took guts. If the new business doesn’t work out, she may have a hard time going back.

With regard to the title, I am aware of the rule that says never end a sentence with a preposition. But I stand with no less an authority than Winston Churchill in saying that this is the sort of nonsense rule up with which I shall not put. So there.

It is hard to think of two companies that are more different than General Motors and Twitter. One deals in heavy metal, is both an American industrial titan and an icon of business history, is a recovering bankrupt, and is everything to do with manufacturing real assets that last a long time. The other is a new company that deals in the deliberately short and ephemeral, employs relatively few—especially when compared with GM—and is a titan of the new social media era. The fact that both are actually successful American businesses gives a look at the scope of what our economy actually covers.

And, yet, even given their diversity and scope, these companies do have something in common—both have seen their growth prospects come into question, as previous assumptions of strength are proving false.

Recently, the weather has been blamed for poor employment figures, poor car sales, and pretty much every other lackluster economic result. Is this a legitimate explanation or just an excuse?

http://www.youtube.com/watch?v=Oowl5eq-NLM 

I had a good talk yesterday with two journalists whom I respect quite a bit, Pimm Fox and Carol Massar of Bloomberg Radio’s Taking Stock. We started off discussing the markets, why things were down, and what might happen, and then they asked an excellent question: what should an investor do, and why?

It was so good a question, in fact, that I didn’t have a good, short answer. So much depends on the investor’s plan, his or her time frame, risk tolerance, and so on and so forth that it’s almost impossible to come up with a succinct response.

With the market’s recent declines, it’s not surprising that the doomsayers are showing up again. In the past couple of days, I’ve heard from several advisors whose clients have received e-mails or read articles that highlight all of the things going wrong, forecasting the imminent collapse of, well, just about everything. Perhaps you’ve received or seen one of these publications yourself.

Let’s start with the real risks. Stock markets worldwide seem to be in the midst of a correction. Here in the U.S., we appear to face the risk of further declines. This has been reinforced by recent economic news that was somewhat less positive than expected. We could be seeing a stock market correction and a slowdown in the recovery. These are real risks, and they shouldn’t be ignored or minimized. They are, however, normal risks, signifying that the economy has recovered to a more normal place. They are not catastrophic risks.

I gave a talk here at Commonwealth yesterday, updating our staff about the economy and the markets. One point kept coming up over and over—that we’re now at or close to normal levels of growth, as of the mid-2000s, which was a pretty good time. In some areas, such as employment, we still haven’t returned to normal levels in total, but getting normal growth is the first step.

(As an aside, this type of internal training and education is part of what makes Commonwealth exceptional. Everyone is welcome, and these talks happen all the time on many different subjects.)