- October 1, 2014: Vol. 26, Number 9

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Uncharted territory: Economic vulnerabilities include

by Geoffrey Dohrmann

The economic and real estate market recovery cycles have been delayed but appear to be following a predictable recovery pattern. Normally these recovery cycles stretch for five to seven years. We are now in year five of this current recovery, but because of the slower pace, the cycle might be extended. Then again, it might not.

We’ve not really been here before.

In light of that, I think it is important to keep an eye on where we are and where we are going. Picking up on some themes I highlighted recently, here are some key economic factors to watch:

•                The Federal Reserve’s stimulus program has not triggered much in the way of consumer demand growth, but it certainly has stimulated a new round of asset inflation. Although it doesn’t appear to be at bubble stage yet, money supply growth still continues, despite Fed tapering. The U.S. government has inflated the money supply by nearly 60 percent since 2008. Many market watcher

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