If you’re a fan of NFL football, you know that the fourth quarter is when all the action comes in most games.  The teams that win consistently are the teams that get tougher in the last 15 minutes week after week.  The economy is no different, relying on the holiday season to make or break any given year.

Last year, Hurricane Sandy made for a wet and limp holiday season.  There are many good reasons to believe that 2013 will be much better – except, of course for the government shutdown.  We don’t know where that will leave us until long after it’s over.  But as we check in with Barataria’s predictions for the year we can get some idea where we stand heading into the critical last quarter.

Except, of course, for the final unemployment stats.  But let’s check out what we can and see how we stand for now.

Jobs
Predictions: Accelerating job growth, reduced gap between youth & overall unemployment.
Results: Job growth up 11% over 2012 YTD, Youth unemployment falling faster.

The ADP job report for September showed a disappointing gain of only 166k jobs that month, or 486k for 3Q13.  That’s up a decent 11% overall year to date.  It’s not bad, but it’s not the 200k gains each month we were hoping for.  At least the trend is positive and the rate of job gains each month is accelerating.

We don’t have the official Bureau of Labor Statistics (BLS) report for September due to the shutdown, but as of August the official headline unemployment rate (U3) had fallen to 7.3% and among 20-24 year olds had fallen to 13.0%.  That’s a gap of only 5.7% between the two, showing that youth unemployment is finally falling faster than the overall.  It’s a sign that employers are hiring people with less experience and taking a chance by investing in young people.  That’s the one prediction that didn’t look as good, but it’s finally coming in.

Consumer Confidence
Prediction:  Normalizing in the 60-70 range.
Result:  Even better!

The conference board indicator consumer confidence slipped below 80 to 79.7.  That probably reflects the impending shutdown that dominated the news at the end of the quarter, and may slip even more if the shutdown continues.  As it stands, consumers are in a better buying mood than they have been for many years entering the big holiday season, so we could still have a good shopping season.  It all depends on how the game plays out in Washington – barring any other disturbances other than the ones our supposed “leaders” are inflicting on the economy.

Corporate Profits
Prediction:  Remaining high.
Result:  Still good!

Corporate profits are up and staying up through 2013, which is the main reason the S&P500 is up 15% year to date.  The normally calm summer had a better than usual gain in the stock market, meaning there is plenty of cash to start hiring.  That’s the main reason to watch corporate profits as we wait for a turnaround.

The net gain in jobs over the quarter showed that 38% were from large corporations, which is all we really care about.  But this is not yet a wave of hiring by big corporations.  That has to come in the fourth quarter, which is what this prediction really called.  For now, we have to be happy that corporate profits are remaining high and see if it starts to turn into general growth.

Real Estate
Prediction:  Continue rising.
Result:  The rapid rise of earlier in the year has calmed, but it still up.

The Case-Shiller index of real estate values in 20 cities across the US is up 12% year over year, a very healthy gain.  That data is a bit slow to come in, with July 2013 being the last month we have a reading for.  It’s very positive news, but there are signs that it is slowing some at the end of the summer.  We don’t want another bubble, so anything over 10% is actually a bit scary at the high end.  It’s been a good year for real estate.

What do we have overall?  Everything is going exactly as Barataria predicted – but we have yet to see how the shutdown will change the numbers for the fourth quarter.  If this is a tough economy it’ll blow right through the nonsense in Washingtoon, but we can’t say for sure just how good it really is.  Hey, it wouldn’t be a game if there wasn’t a good challenge at the end of it, right?

Except, of course, this isn’t a game.  This have been going very well in 2013 and overall we have turned the corner into reliable economic progress.  Let’s hope it hasn’t been screwed up.