Unfortunately, the administration’s policies and the administration’s refusal to stop spending is moving us closer to a double dip recession and a downturn in our credit rating. The D.C. elites cannot work out a compromise and they are creating the Perfect Storm.
In the first three months of the 2011 year, the economy rose just 0.4 % a sharp downward revision from the previously reported 1.9 % gain. It came dangerously close to receding in January – March and this can hardly be called growth. The economy was at a near standstill in the 1st quarter despite previous erroneous (fallacious?) reports. The 4th quarter of 2010 was not 3.1% as reported, but rather it was 2.3%
This is after being promised an 8% unemployment rate and a renewed economy if we spent the rest of the TARP and the Stimulus to the tune of almost 2 trillion to say nothing of the trillions of unbacked dollars we have printed. The National Conference of State Legislators puts the unemployment rate at 9.2%. Gallup puts underemployment at 18.3%
The Commerce Department said on Friday that CPI increased to 1.9% – a slow rate of recovery at best and we will see if that number gets readjusted as all the other have been.
Consumer spending accounts for 70% of economic activity and was only .01% during the second quarter – nearly a complete stop. Stocks continue to fall on Wall Street while the dollar fell.
In addition to the goings-on in D.C., bad weather, scant income gains, a weakening dollar, and high gas prices have stalled the recovery, the Japanese quake especially hit us hard with car sales. Incomes only rose .7% this quarter and last. Gas prices hover around $4 a gallon.
Job hiring is faltering badly with many businesses refusing to hire in this uncertain climate, citing taxes and healthcare as major issues. A paltry 18,000 jobs were added in June. Merck & Co said on Friday that it plans to slash thousands of jobs by late 2015 to wring out savings of up to $1.5 billion a year.
Sales of U.S. manufactured factory goods fell. Housing is still on the decline and car sells fell again. U.S. new-car sales have been improving slightly in July compared with the previous two months but remain below the rate seen earlier in the year, research firm J.D. Power and Associates.
Consumer sentiment fell in July to its lowest point in more than two years, as anxieties over stagnant wages and rising unemployment deepened, a survey released Friday showed. Confidence in government economic policies reached a new low under the Obama administration.
Inflation slowed in the 2nd quarter but pressure to raise prices is across the board.
Reuters: The government now says the economy is smaller than it was before the recession. Prior to the revisions, the government had said production of goods and services surpassed the pre-recession level in 2010.
“The depth of the recession is now clearly so much deeper,” said Nigel Gault, an economist at IHS.
The government revises its data on the economy annually, using a variety of updated information from the Census Bureau, Internal Revenue Service, and Labor Department…Read here: Facing a double dip