Posted on 03/28/2015 3:17:44 PM PDT by expat_panama
(excerpt from) Something weird is going on in the US economy, and it's not good...Despite experiencing a healthy pace of job growth, the US economy has largely disappointed economists' expectations by delivering a series of weaker-than-expected economic reports.The unexpected plunges in retail sales and durable goods orders stand out as they reflect weakness in both consumers and businesses. On Wednesday, Bloomberg LP Chief Economist Michael McDonough tweeted a chart of the unprecedented divergence between job growth and retail sales growth. This is concerning as personal consumption accounts for roughly 70% of US GDP. It's particularly concerning considering all of the extra spending money Americans supposedly have thanks to falling gas prices. "Recent US data have been disappointing," Goldman Sachs Kris Dawsey said late Thursday. Dawsey thinks GDP growth could tumble to 1.4% in Q1 from 2.2% growth in Q4 of last year. Economists had previously expected GDP growth to accelerate in Q1 to around 3%. Q2 Comeback?
|
--is that (1) this "weird" stuff really is happening, (2) but not the way BI said, and (3) it's actually a good thing.In the first place BI's numbers are real and true. However the article uses them to support the belief that we got "...plunges in retail sales... ...the unprecedented divergence between job growth and retail sales growth." Reality is that for years now we've not seen falling sales and rising employment, we've had falling employment and climbing sales.The 'misunderstanding' (a kind way of saying "deceit") was caused by allowing monthly changes in jobs'n'sales to pass for what's really going on with jobs'n'sales. Reality is that the actual cumulative increase in sales since the recession, is really a 15% climb, while total employment's dragged up a meager one percent. Job stagnation looks even worse when we take into account population growth over the period --17 million more people is a 6% expansion that shows how our 1% employment increase is truly inadequate. But we digress. But as long as we're digressing how about we also remember that this so-called 15% boom in sales ignores inflation and population growth. Taking those factors into account we find that real per capita sales is down 5% from the pre-recession high and remember that for decades Americans had been enjoying continuous sales growth-- OK so the economy sucks but that's still not the point. The BI writer (he holds a BA in Religion from Boston University) screwed up by passing on the idea that the drop in sales was an "unprecedented divergence" along with a the graphic that circled an era going back years. Coming back to the Planet Earth the divergence that we do have does not span "years". It's been going on now more like for a couple months. Hey, remember that everyone says "size doesn't matter" so let's be happy with what we got because there're a number of reasons why falling sales and rising employment can even be good for us. For starters it means that people are getting back to work and they're saving for hard times ahead. Americans. Ya can't beat 'em. Another reason is that the past few years of stagnant jobs and rising sales has only been possible because of the rise of spending by the elite wealthy. Whoa --we're not going into some goofy income inequality shtick because equal incomes is what Marx advocated. Bad idea. Our problem is that until recently the risk has been a separation between the rich and poor --an opportunity deficit that threatened to close the book on America's success stories. These past few months offer reassurance that wealth class structure is not that solid after all. Finally my take is that at the very least falling sales --while short term pain-- can be a 'wake-up-call' for the policy wonks that don't know or don't want admit the economy sucks. They might even get off our backs and let us get back to work... |
The weirdness in the economy couldn't wait for Sunday morning.
How much of that savings in gasoline costs is going directly into higher health care costs, I wonder.
Reports that the US had emerged from the recession (0bama DEPRESSION) have been greatly exaggerated (totally fabricated).
With 93 MILLION working age Americans having given up even looking for work, printing money and throwing it at the economy won't even hide the facts anymore.
"Unexpected"
So, this author thinks part-time hires represent great job growth? Sheeple.
Something weird is going on. No kidding, going on for the past six years.
Not sure how they come up w/ that number, tho I hear Rush toot it all the time. When I subtract the employment level from the employment age population I get an increase that's over 100 million.
According to the numbers I’ve seen, all of it.
Similarly, I thought that 2015 was going to be the year people would feel the sting of 0babacare via high premium/high deductible health plans.
Seems like that would be a contributing factor as well.
I said it here and doing it again:
Oh, yeah: They didn't mean to/never intended to do it to the economy...
...and it was unexpected
</sarc>
What does Rush care? He is a Free Traitor gloBULList i.e. mainstream Republican. He loves the ChiComs.
Very good post. Americans continue to deleverage.
Check your data. FT v. PT has improved greatly.
That seems to be the white elephant in the room, doesn’t it?
OK, so it was worse in 2010. Swell. In the mean time, since the recession employment's gone up a couple million, the population's gone up 17 million, and 3 million have gone from full time to part time. The word "improved" is a little hard to take right now...
Especially with many people getting a surprised reduction in their EITC benefits or cut of the tax refund because the Obamacare subsidies were too high.
Bad link.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.