Posted on 09/28/2015 1:58:13 PM PDT by blam
Elena Holodny
September 28, 2015
The US economy grew at a 3.9% pace in the second quarter.
The Bureau of Economic Analysis noted that the rise in the GDP was led by consumer spending on healthcare, food services, and accommodation.
But notably, the good news about US consumers comes at a time when the rest of the global economy isn't doing so great.
Those concerned about the US economy are inevitably wondering which has the bigger incremental effect on growth: the healthy US economy or the ailing international economy?
In a recent note to clients, RBC Capital Markets chief US economist Tom Porcelli examined the trends by using two components of GDP as proxies: net exports of goods and services to reflect the effects of a slowing global economy, and real personal consumption expenditures to reflect the US consumer.
And he argues that when it comes to the US economy, the positive effects of the latter overshadow the negative effects of the former.
"One could argue that the global weakness this year has had some real effect on US trade, which has fallen on a trend basis to a lowly -0.55% contribution to topline GDP," writes Porcelli. "But the reality is that the entirety of this fallout has been offset (and then some) by the strengthening US consumer. The contribution to GDP from real consumption is now at 2.1% and up 0.8% from early 2014 (the last time trade was a 'neutral' contributor to topline growth."
(snip)
(Excerpt) Read more at businessinsider.com ...
Until quietly adjusted downward later next month...
If the country is doing so good why is the middle class doing so poorly?
Stocks had a fifth straight day of declines on Monday. Biotechs got smacked again, and the iShares Nasdaq Biotechnology ETF fell by as much as 6%; last week was the worst for the sector in four years.
First, the scoreboard:
• Dow: 16,001.26, -313.41, (-1.92%)
• S&P 500: 1,881.08, -50.26, (-2.60%)
• Nasdaq: 4,541.03, -145.46, (-3.10%)
(snip)
I think there will be a few negative “unexpected”s in our near future.
This is good news.
For one Donald Trump.
The top line number may be accurate, but the wealth is biased heavily toward the crony capitalists.
DOW closed -312
Exactly.
Precisely.
If you believe this is anywhere near accurate wait two to three weeks. :-)
They are including “healthcare spending” in their stats. This is 0bamacare spending that was ruled a tax by the courts.
What other taxes are they counting as “consumer spending”?
You’re right.
Hey, its a tax when they want it to be and its spending when they want it to be. Who are we to judge?.,.
And when they have a bunch of unemployed males sitting around in China, their next job will be marching into downtown Taipei.
The world economy stinks and inflation and the cost of living increased and is now being counted as growth.
Food and shelter, health care costs have increased.
Fuel has gone down and offsets the suffering a bit.
What a sham the government book cookers put fourth.
Perhaps getting robbed at gunpoint is also counted as “consumer spending”.
Or heading to the mideast to encourage their oil supplier to offer discount prices.
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