Tag: Gross Domestic Product

Not Since World War Two

2020 election is around the corner and there are things one should consider before they cast their vote (ever how many times they are told to)……economics should be one of those deciding issues.

The markets are hitting all time highs and yet the deficit just keeps growing….and GDP is not all that good either….now I am waiting for one of those “expert” economists to explain this….probably in graphs that NO ONE understands…..

The federal budget deficit is projected to hit a record $3.3 trillion as huge government expenditures to fight the coronavirus and prop up the economy have added more than $2 trillion to the federal ledger, the Congressional Budget Office said Wednesday. The spike in the deficit means that federal debt will exceed annual gross domestic product next year, a milestone that would put the US in the company of countries like Greece whose accumulated debt exceeds the size of their economies, the AP reports. The $3.3 trillion figure is more than double the levels experienced after the market meltdown and Great Recession of 2008-09. Government spending, fueled by four coronavirus response measures, would register at $6.6 trillion, $2 trillion-plus more than 2019.

The shutdown of the economy in the spring led lawmakers and President Trump to pump money into stimulus steps that have helped the economy in the short term. Most economists are untroubled by such huge borrowing when the economy is in such peril, and the debt was barely a concern when a cornerstone $2 trillion coronavirus relief bill passed almost unanimously in March. But now that lawmakers and the White House are quarreling over the size and scope of a fifth virus relief bill, Republicans are growing skittish at the enormous costs of battling the pandemic. The Democratic-controlled House passed a $3.5 trillion measure in May. Sentiment among top leaders in the GOP-held Senate has been for a bill in the $1 trillion range, with recent party efforts focused on a measure that’s even smaller.

This will take the Congress to screw someone to try and stem this tide…..and that usually means the poor and working people of this country.

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“lego ergo scribo”

Next year could be another historic year…..it is on track for the deficit will out pace GDP……

 

The Red Meat Trump Should Throw

President Trump is always throwing red meat to his supporters when things are looking dismal for his admin……the latest is the “take a knee” thing…..it is part of the “Trump Two Step:  A Political Tango”……

Instead of making up news and situation that has everyone scratching there heads why not throw the country “real” stats and figures?

Like the news from yesterday…..

The US economy grew at an upgraded annual rate of 3.1% in the spring, the fastest pace in more than two years. But growth is expected to slow sharply this quarter in the wake of a string of devastating hurricanes, per the AP. The April-June expansion in the gross domestic product—the economy’s total output of goods and services—is up slightly from a 3% estimate made a month ago, the Commerce Department reported Thursday. It is the strongest performance since the economy grew at a 3.2% pace in the first quarter of 2015. The upward revision reflected larger farm stockpiles.

The year started with a lackluster 1.2% gain in the first quarter. Economists believe growth has slowed again to around 2% in the current quarter. The revised figure was the government’s third and final look at GDP for the April-June period, and left GDP rising at an average 2% pace over the first six months of the year. That matches the lackluster average annual growth rates seen since the recovery from the Great Recession began in mid-2009. Economists at Macroeconomic Advisers believe that growth in the current quarter could tumble by as much as 1.2 percentage points due to hurricanes Harvey, Irma, and Maria. But analysts think the initial losses to GDP will be made up in subsequent quarters as rebuilding gets underway.

This is good news that the country would love to hear…..

This may be a short-lived story but it is good news and he could be making his case for the economy….instead all this push and shoving on Twitter.

Why make up a story when there is a good news story staring him in the face?

 

Let’s Talk GDP

For fun why don’t we talk economics today?  Damn, so quiet we can hear a pin drop…..I can hear all those rectums slamming shut……..damn I like this stuff!

Gross Domestic Product (GDP)……..The monetary value of all the finished goods and services produced within a country’s borders in a specific time period, though GDP is usually calculated on an annual basis. It includes all of private and public consumption, government outlays, investments and exports less imports that occur within a defined territory.

In a recent report it was said the economy was limping into the recovery….it feel short of expectations……it grew at an anemic 0.1%, that is one tenth of one percent…………and what does that mean to the country?

This from Bankrupting America………

  1. What Drove Economic Growth In The First Quarter? Consumer Spending. Market Watch reported that consumer spending increased 3.0 percent in the first quarter, slightly down from a 3.3 percent increase from the last quarter. Consumer spending accounts for more than two-thirds of economic output in the U.S. so a continuing growth rate in this category is a good sign.
  2. If Consumer Spending Growth Rose, What Was The Money Spent On? Healthcare.  Healthcare spending rose 9.9 percent in the first quarter of 2014, the largest increase in the growth since 1980. The rapid increase in health care spending was primarily because of the implementation and enrollment deadlines of the Affordable Care Act. According to Business Insider, “The first-quarter advance estimate reflects spending from January through March, the first three months when millions of people who gained insurance by signing up on exchanges established by the law or by qualifying for Medicaid coverage under the program’s expansion.”
  3. What Hurt Economic Growth In The First Quarter? Business Spending. Business investment spending dropped considerably this quarter, according to the report. Fixed nonresidential (business) investment fell at a rate of 2.1 percent after a 5.7 percent increase last quarter. The Wall Street Journal reports that business equipment spending experienced the worst drop since the second quarter of 2009, with a decrease of 5.5 percent.
  4. What’s Going On With The Housing Market? After dropping last quarter, investment in the housing market continues to decline. Investment in home building and improvement decreased 5.7 percent after a decrease of 7.9 percent in the last quarter. The Wall Street Journal points to a low level of home sales, low housing inventory, and increasing mortgage rates as contributing factors to the slowing of the housing market.
  5. What Was The Reaction From Economists? Most economists were surprised by the weak report, after a general consensus that the U.S. economy would grow at a rate of 1.1 or 1.2 percent for the first quarter. Dan North, chief economist at a credit insurance firm, noted in a New York Times interview that if growth does increase over the year, it probably won’t be a sign of a stronger economy: “’We’ve been living in sub-3 percent land, and people have gotten used to that as the new normal,’ Mr. North said in an interview before the Commerce Department announcement. ‘But it’s not. It’s anemic.’”

The economy just keeps creeping along………but why?  Could it be that as long as it is anemic then the corporations get everything they want with the promise that if they do the economy will boom?

Is this a plan?  Or is it just the luck of the draw?

 

Recovery Well On Its Way!

Daily Agitator

May I see a show of hands from all those that see a clear path forward in the economic situation we are fighting these day?  If you raised your hand please write down why you feel the recovery is doing well…..

Gross domestic product, the broadest measure of economic activity, rose at a 3.2 percent annual rate in the first three months of the year, the government said Friday. That was the third straight quarter of increase, driven by a rise in spending by American consumers and increased business investment.

Good news, right?  Well yes and no…yes, it means that Americans are spending, but if they are spending they are not saving…..which is good if you want the economy to recovery…but then are they spending “real” money or their plastic?  If the later then a personal recovery is NOT going to happen and this could start yet another recession or at least feed it….to my mind this is “plastic” spending and in NO way shows that the rest of the economy is in good shape.

Unemployment remains steady at 9.7% or so and that is just those applying for benefits, nothing is said about the many that are gone from the rolls and may have stop looking for work……even this supposed “good news” economically if it stays kind of consent will mean only about a .5% drop in unemployment at the end of the year…

Once again the “good news” is for investors not those that actually work for a living……..

drags on the economy this year are residential and commercial real estate. In the first quarter, both declined, with residential investment falling at a 10.9 percent rate and investment in business structures dropping at a 14 percent rate.

As much as some do not want to admit…if it were not for the stim plan….we would be under a huge pile of crap…….the stim plan has done a lot to slow the recession, for without we would be standing in a soup line…..I know it is government spending…but if not them…then who?

There is only so much crap that they can spread on the economy and believe me….they lay it on thick!  Look into your wallet……is the recession getting better?  Is the recovery effecting you?

Where Is The Upside?

Tuesday, April 28, 2009, I was told by the media that the consumer confidence was on the rise and that could show the beginnings of the recovery are finally here.

Consumers assessment of present-day conditions improved moderately, with those claiming business conditions are “bad” easing to 45.7 percent from 51.0 percent, while those claiming business conditions are “good” rose to 7.6 percent from 6.9 percent.

Consumers expecting business conditions to worsen over the next six months declined to 25.3 percent from 37.8 percent, while those expecting conditions to improve rose to 15.6 percent from 9.6 percent in March.

This is a good thing right?  God knows I want the recession to end and end soon, but who did these people talk with?  There is about 13.5 million unemployed and countless others waiting for the hammer to fall on their jobs.  What consumers are confident?

Then on Wednesday, 29 April 2009 the news of the GDP hit airwaves.

The U.S. economy plunged again in the first quarter, making this the worst recession in at least half a century.

Gross domestic product dropped at a 6.1 percent annual pace, weaker than forecast, after contracting at a 6.3 percent rate in the last three months of 2008, the Commerce Department said today in Washington. The report, which reflected a record slump in inventories and further declines in housing, comes hours before Federal Reserve officials decide how much money to pump into the economy.

Gross Domestic Product–value of production within a country’s borders.  This fell and now is as low as it was 50 years ago……what part of that breeds confidence?

As The Economy Contracts

Gross domestic product (GDP) figures released yesterday by the Commerce Department show that the US economy shrank by 0.3 percent on an annualised basis in the three months from July to September. With economists expecting even poorer GDP figures for the fourth quarter, the latest data confirms that the economy has now entered into severe recession.

Negative GDP growth for the third quarter was driven by a 3.1 percent decline in consumer spending, the first such contraction since 1991 and the largest fall recorded since 1980.

Consumer spending, partly fuelled by personal debt, has accounted for more than two-thirds of all economic activity in the last period. But mounting layoffs, home foreclosures, credit card defaults, the rising cost of living and the declining value of retirement savings have had a devastating impact on broad layers of the population. The Commerce Department reported an extraordinary 8.7 percent third quarter decline in disposable personal income—that is, income after taxes and adjusted for inflation. This is the largest fall ever recorded since figures were first kept in 1947.

Unsurprisingly, spending has declined together with incomes. In the three months up to October, purchases of non-durable goods—smaller purchases such as food and clothing items—plunged by 6.4 percent, the biggest decline since 1950. Spending on durable goods, such as cars and furniture, declined by 14.1 percent.

The third quarter 0.3 percent GDP decline was not as severe as had been anticipated. Stock markets lifted marginally yesterday, with the Dow Jones closing 2.1 percent higher. Goldman Sachs economists, however, warned their clients that the GDP report was “weaker than implied by the initial market reaction.”

The data would have been significantly worse had it not been for a narrower trade deficit caused by continuing export growth to Europe and Asia. This growth has since ceased and exports are in decline as the world economy follows the American into steep recession. Also preventing a sharper drop in third quarter GDP was federal government spending and investment, which was up 13.8 percent on an annualised basis, largely due to an 18.1 percent rise in military expenditure.

Info for the voter to take into the general election on Tuesday.