Another great unknown for 2011 is what impact higher federal tax rates will have on the economy. Barring new legislation, tax rates are set to rise in 2011.
Source: Fidelity
Macroeconomic Advisers, a well regarded economic research firm, places the odds of a recession in the coming 12 months at effectively zero. This suggests to us that what is likely to occur is a softening on economic data, but not an outright recession.