Posted on 06/25/2014 7:10:00 PM PDT by lbryce
In the first quarter of 2014, GDP shrunk 2.9 percent and most of the reason is because health-care spending declined. That doesn’t mean we’re in for a recession though. Obamacare did help crash the economy. Only not in the way its critics thought it would.
The Commerce Department on Wednesday revised the growth figures for the first quarter of 2014, and concluded that the economy shrunk at a 2.9 percent annual rate. This comes a month after the government slashed its initial estimate from an annual growth rate of .1 percent to a decline of 1.0 percent. At the time, I called it a hiccup rather than a heart attack.
That was some hiccup.
At first blush, the substantial downward revision is something of a mystery. The U.S. economy didn’t suffer from any major shocks. There was no threat of default, government shutdown, huge cuts in government spending, or sharp tax increases. No major financial institution failed.
Throughout the winter and spring, companies warned that the brutal weather—the disruptive snowstorms, the arctic cold—would have a dampening effect on economic activity. And the weather definitely played a role in stalling the main engine of the U.S. economy—the American consumer.
The BEA breaks down sectors by their contribution to GDP. Personal consumption expenditures—people buying stuff—grew at a meager one percent rate in the first quarter. And that had a significant impact on businesses. When companies add to inventories—i.e. they sell stuff and then order more stuff in anticipation of higher sales down the rate—at a strong rate, it adds to GDP. When they don’t restock depleted inventories, it detracts from growth.
(Excerpt) Read more at thedailybeast.com ...
That ObamaCare helped crash the economy is not in the least bit news.The plain and simple fact is that ObamaCare was specifically designed to do just that. To cause as much damage to the economy as possible. As if Obama gives a Demo'rat's behind about the health of the American people or its economy.
But HuffPo said Obamacare helped save the economy! How can this be?
-2.9%. We’re going backwards and the MSM press still tries to spin it.
When the GDP shrinks, it's a reflection of lower levels of economic activity. Under normal circumstances a decline in health care spending would be offset with growth in other areas -- and exorbitant increases in insurance premiums are still economic activity even if we don't like paying them.
There's more to this than just ObamaCare. I suspect a big part of it is tied to increasing numbers of workers simply checking out of the workforce and reducing their purchasing considerably.
Does anyone doubt there will be a new formula within tbe next couple days? It will demonstrate that Q1 was zero or modestly positive and Q2 will, no doubt, feature robust growth. No recession for the King!
Right, keep telling yourself that, it can’t be bad economic policy theories by Marxist morons putting downward pressure on employers for the jobs trend, it must be the employees leaving the job market.
Rates have doubled, tripled and quadrupled. For those who haven't experienced it yet, they are aware of what is coming down the road. Discretionary spending has dried up.
Retail and restaurant chains were already suffering, now they will have no choice but to declare bankruptcy.
It's going to be very painful, but it was obvious what was going to happen. It was planned that way by people who hate this country.
-2.9 is the number they are admitting to.
Methinks it is a lot lower.
And the white house cheers.
They’re pissing down our backs and telling is that it’s raining.
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