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What Could Go Right in 2014

NEW YORK (TheStreet) -- We are hearing all sorts of predictions and warnings about what could go wrong in 2014. Since so many things didn't go wrong this year, our antenna may be up and we may be more inclined to listen.

But how helpful have these warnings been in the past? Was it "right" to be fearful the U.S. and global economic recoveries would be slow and unsteady; that unemployment would still be as high as it is five years later; that unprecedented intervention by the Federal Reserve would put us in uncharted territory as far as inflation and currency risk?

Without question it's been "right" to be fearful --but was it right, in retrospect, to act upon your fears?

One year ago it was the fiscal cliff -- the return of higher tax rates on income, dividends and capital gains, not to mention the much-maligned sequester and the damage that would be done to both consumer and corporate spending. The unemployment rate was measured at 7.8% a year ago, but most everyone was focused on the under-employment rate.

According to the U.S. Bureau of Economic Analysis, consumer expenditures on major items were up every single month this year. Spending among Americans in January was higher than spending in any month during 2012.

On the corporate side we saw companies begin to deploy their massive cash hoards this year. In addition to buying back their own stock, corporations spent on technology (just take a look at how the Nasdaq fared this year) and other capital goods.

Improvements in labor, housing and the stock markets -- and the associated "wealth effect" -- have led to increased consumer demand for new automobiles, homes and clothing. This, in turn, has led to an increase in demand by corporations for the materials needed to manufacture and deliver automobiles, homes and clothing. According to Bloomberg, "Orders for long-lasting goods such as computers and machinery climbed in November by the most in 10 months..."

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