Annoying misfeature: ZSH completely hides output without newlines!

[Einar Huginson <huginson@web.de>]

I have tried this with ZSH 4.2.5 and 4.2.6, linked against ncurses 5.4 
(specifically the Gentoo ebuild 5.4-r6). Note that PS1='$ ' and I have marked 
the cursor position with _

1. Example: Just echo text without a newline

	$ echo -n foo
	$ _

2. Example: cat a file that has no newline after the last (third!) line

	$ cat bar
	blah1
	blah2
	$ _

Note that the cat command itself works, the data is not lost, just not being  
displayed in ZSH

	$ cat bar | wc -w
	3
	$ _

Compare with the output by bash

	$ echo -n foo
	foo$ _

	$ cat bar
	blah1
	blah2
	blah3$ _

IMHO, this counts as a serious problem, since certain file contents are no 
longer visible, and files appear to be empty even if they aren't. I initially 
thought that my more involved prompt was at fault, but that doesn't seem to 
be the case (PS1='$ '). Or do I need to set a ZSH config option that prevents 
it from clearing the line before outputting the prompt?

Confused,
  Andreas Koch