Bloomberg reported at 8:30 this morning that the “Gross domestic product, the value of all goods and services produced, rose at a 1.5 percent annual rate after a revised 2 percent gain in the prior quarter, Commerce Department figures showed today in Washington. The median forecast of economists surveyed by Bloomberg News called for a 1.4 percent increase. Household purchases, which account for about 70 percent of the world’s largest economy, grew at the slowest pace in a year.”
The economy is slowing notably and the dreaded QE is on the horizon, probably in time to boost Obama’s election chances as it produces a false sense of growth with borrowed and printed money based on bad or non-existent assets.
We are faced with economic retraction. Job and consumer confidence is down, new home sales are down over 8%, and retail sales have dropped sharply at .5%. The government predicted a gain in retail sales of .2%. You might as well ignore government prognostications.
Gallup reports a slight dip in unemployment down to 7.9% and 17.2% for unemployed and underemployed respectively but they see little improvement in the last three months despite some slight job gains this month.
Sales at retail and food-service establishments dropped 0.5 percent in June from the prior month, the Commerce Department said, in contrast to the 0.2 percent gain that was expected.
That in turn has prompted a fresh wave of downgrades to already-lowered growth expectations for the second quarter. Pierpont Securities economist Stephen Stanley, for one, took his tracking estimate to just 0.6 percent after the report (combined with a somewhat firmer read on May business inventories).
“I am running out of room with regard to being above zero!,” he wrote in a note to clients.
The CBO predicted a fiscal Armageddon under current policies and Bernanke repeatedly warns that we are on a fiscal cliff.