“Uncertainty” has become common code for economic pessimism, a point challenged by the title of an editorial from Andrew Kahr in BankThink: “Uncertainty Is Killing Our Bank!’ No, Inaction Is.”  Of course, Mr. Kahr is right; inaction is the true evil, but uncertainty partially causes inaction. Shakespeare makes the argument much better than I can, in Hamlet’s classic “to be or not to be” speech:

“But that the dread of something after death,
The undiscovered Country, from whose bourn
No Traveller returns, Puzzles the will,
And makes us rather bear those ills we have,
Than fly to others that we know not of.
Thus Conscience does make Cowards of us all,
And thus the Native hue of Resolution
Is sicklied o’er, with the pale cast of Thought,
And enterprises of great  pitch  and moment,
With this regard their Currents turn  awry,
And lose the name of Action.”

It’s the dawn of a New Year, uncertainty about the fiscal cliff, about banking regulation, and about consumer confidence is everywhere.  At the same time, employment, income, and prices have been tenuously rising for the last six months, indicating that the worst of the recession is over. The biggest uncertainty then is: how uncertain are we? Perhaps the best thing to do is to put uncertainty aside, and keep calm and carry on. (Unless, of course, like Hamlet, you’re contemplating suicide; then I’d rather you stay uncertain).

Original post on blog.andera.com