The Economist turns very gloomy about the U.S. economy in 2003--and the U.S. economy in 2003 is one of the brighter spots in the first-world economic picture...

Economist.com: ...The biggest obstacle to healthier economic performance, though, is political. As the Fed’s chairman, Alan Greenspan, acknowledged in the closing months of 2002, uncertainty about the future is holding both investors and consumers back. The shadowy threat of international terrorism and the much more explicit prospect of a war with Iraq has made many Americans nervous about the future. For businesses still reeling from the speed at which the late-1990s boom turned to bust, the political climate is one more reason to put off investing in new plant and equipment or hiring new staff. For consumers, for so long the mainstay of the American economy, the thrill of the shopping mall seems, finally, to be on the wane. On January 17th, the respected University of Michigan survey of consumer sentiment showed an unexpected drop because of gloomier expectations of future spending.

That’s certainly what some of the most recent figures imply. Eight out of 19 manufacturing industries showed a fall in production in December. Car production fell by 4.7%, possibly a sign that the boom in car sales—fed by discounts and interest-free promotions—has faded. Static or falling production is not a comfortable base from which to make decisions about upgrading factories.

Nor does it encourage companies to hire new workers or retain existing staff. Employment fell by 101,000 in December—a sign that upheavals in the labour market continued all the way through 2002. The fact that the unemployment rate stayed at 6% suggests some people have given up looking for work (and so are not counted in the jobless data). That might have contributed to the fall in initial unemployment claims too, although economists reckon that seasonal upheavals in working patterns make figures at this time of the year especially hard to assess.

It is hard to put a favourable interpretation on most of the data. But it is important to keep a sense of perspective. Some recent figures look disappointing partly because they fall short of over-optimistic forecasts—a persistent weakness of those paid to predict the economic future, no matter how often they are proved wrong. The Fed’s beige book confirms that the economy remains weak, but also reveals signs of pick-up in several regions, most notably the industrial north-east. And America is still among the fastest-growing of the big industrial economies.