Horrid Economy Stalls to Only 4.9% GDP Growth
Greater Depression Just Around the Corner
By Adam C Posted in Economy — Comments (21) / Email this page » / Leave a comment »
The Economy grew at 4.9% last quarter. That means Americans created $3.28 trillion in goods and services in 3Q 2006 and $3.44 trillion in 3Q 2007. Americans created an additional $160,000,000,000+ in goods and services than this time a year ago.
The media should really look into the mirror about its economic reporting. When an economy is expanding at this hot of a clip, it is hard to understand why most people feel so financially insecure. Unfortunately, the MSM has created a narrative of economic insecurity that they are unlikely to change when it does not match up with the economic facts at hand.
It is assumed that 4Q will see slower growth which would be more normal. But the idea that we are already in a recession is a rather outlandish suggestion.
America is fortunate to be so rich and to be getting so much richer each year. Due to our economic freedom, we have increased our output in the last 3 months by more than an entire year of production of Morocco. So we took our already large economy and added a Morocco-sized one to it. Yeah, we're that good.
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I had three new cars instead of two and digital cable instead of just expanded cableand a fancier cell phone. Until then I will do my best to hang on until better time come.
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If a Democrat wins in 2008, you can be sure that the coverage will change on Jan. 20, 2009 - and the story will be that we are suddenly well off because the Democrats are redistributing income by making the big bad rich people pay an even greater share of the taxes and giving everybody else big happy entitlement rewards to get them through.
I really do question the deflator used to get the 4.9% growth. Do you seriously believe that we only had .9% inflation in that quarter, the lowest in years?
That is interesting. In the same article it mentions that "Consumer inflation was unrevised at 1.7%, within the Federal Reserve's target zone. Core prices, which exclude food and energy, increased at a 1.8% annual rate. Core prices are up 1.9% in the past year."
So I'm unsure where the .9% comes from.
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If you got a better source, lets have it. Their number beats any anecdote about how much a gallon of milk costs today.
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Underlying most arguments against the free market is a lack of belief in freedom itself. - Milton Friedman
Even core CPI running at least an entire point higher (and nominal at least 2) I wonder how you could get a .9% deflator for the GDP. I am not arguing that growth still isn't strong, just that this measure seems a bit off when compared to all other government inflation data (Core CPI, CPI, PCE, Etc.)
With the Democrats' Defeatocrats' plans to force our surrender in Iraq setback by all the progress recently reported from Iraq, the Dems decided to change the subject:
This underscores the party leadership’s concern to avoid getting bogged down in more debate about Iraq and to make sure it is President Bush and Republicans who are blamed in the 2008 election for voter anxieties about the economy.
No sooner did The Hill report on the Congressional Democrats attempt to change the subject and seize on public fears of an economic downturn, than the Commerce Department reported that the U.S. economy expanded at the fastest pace in four years during the third quarter, growing at a real annual rate of 4.9%.
I tell ya, I just blame all Americans for making the economy this bad.
It's not just Bush, it's endemic to this culture: we want to FAIL!
;)
Fact is, we're the most resilient and profitable economy in the world. I've had a very local recent economic downturn of my own but I don't have much doubt that in a few months it'll turn around.
Yes, I know, I share the blame with other millions. By RELENTLESSLY pursuing free market ideals -- choosing my own car, health care coverage, grocery stores, shopping for the best quality at the best price (gasp!) , working at jobs I had to find and qualify myself for with no government interference help, I know that indeed......
I am partly to blame for this horrible economy! May all of us be cursed with 40 more quarters JUST like this one!
I should be spanked immediately -- or maybe immediately after the Cowboys crush Green Bay tonight.
Stare decisis is fo' suckas -- Feddie
I was, after all, Time's person of the year!
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The American people demand to know how, as president, Clinton, Obama or Leftwards will reverse this trend!
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...but possibly salient:
When an economy is expanding at this hot of a clip, it is hard to understand why most people feel so financially insecure.
Individuals don't experience the "economy" as an aggregate - they only see it via their own experience (the parable of the blind men and the elephant). So if individuals feel squeezed personally, it might not matter to them whether the big abstract total thing called "the economy" is improving.
The role of the media in shaping how people feel they're doing personally is a valid question, of course.
Most people when asked about the economy will say, "I'm doing just fine, but boy, we are sure that everyone else isn't doing as well as us." So people feel they are doing fine, but because of media bias... all of their 'neighbors' are struggling, hence the economy isn't very good.
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Two thirds of the world is covered by water,
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...when you are told over and over again that it's the "worst economy since the Great Depression." That makes people worry about what COULD happen to their financial situation, even if they are perfectly fine at the moment.
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Underlying most arguments against the free market is a lack of belief in freedom itself. - Milton Friedman
This is why the New York Times doesn't call it the Bush economy anymore. They were always referring to it as "the Bush economy" in the early days of the Bush admin, when the economy was shedding jobs each month. But with a growing GDP and an unemployment rate at 4.7 percent, the New York Times seems to think that someone other than Bush is running the US economy.
The revised Q3 number was pumped up by a double-digit improvement in US exports. I was thrilled and surprised to see the upward revision.
But at the risk of sounding like I'm talking down the economy in a political season, I have to remind you all that consensus estimates for Q4 are running anywhere from 1% to 2% growth.
The dollar seems to have found a bottom against the euro in recent days, but a good part of this is because credit conditions in Europe have taken a wicked turn for the worse.
If, as seems likely, the Fed cuts interest rates again on December 11, the downward pressure on the dollar will increase.
And that makes America's exports more attractive in world markets.
I talk to a lot of people, and very few of them have terribly strong feelings about the outlook for next year. Conditions are extremely uncertain. I believe the upside risk is nearly as high as the downside risk.
But the growth in the world economy is no longer in the US. The best-case outcome, and one I think is quite likely, is that continued dollar weakness will enable the US to take a lead role as an export producer, as demand-growth is led by Asia.
I often get tagged as a grinch for being negative about US growth. I'm terribly sorry but I believe we can do far better than we have been. US per-capita GDP is the largest in the world among large economies at around $45,000.
A proper economic policy for a Republican Administration would have two key elements: First, make American exports as attractive to Asia as possible, and second, to encourage gains in US productivity to get our per-capita GDP to $60,000 or more.
I'm not kidding. I think that is achievable.
make American exports as attractive to Asia as possible, and second, to encourage gains in US productivity to get our per-capita GDP to $60,000 or more.
I assume inflating our way there isn't an option. :)
I like your thinking, but the way I see it, it would require some big changes in the economy. There's been some huge opportunity costs related to the housing market, energy prices, social programs, and (I'm sorry) military spending. To get the boost that you're wanting, we'd have to do some pretty serious retooling.
There's also some big (but not insurmountable) challenges regarding exports. The big growth in Asia seems to be fueled by China, and getting them to change their currency policies or import regulations seems unlikely. Speaking from experience, doing business in the PRC is fraught with hidden dangers and challenges.
Japan has a lot of similar difficulties. I'm don't know as much about Korea or India, but expecting them to pick up the slack seems like a pretty remote possibility.
Given those conditions, what kinds of policies would you like to see implemented? It sounds like you've got a plan of sorts.
Not billion.
Underselling our awesomeness, Adam.
“I think we are the team to beat in the NL East -- finally.” - Jimmy "MVP" Rollins, 1/23/07