The Gross Domestic Product contracted by 1.4% in the first quarter despite predictions of 1.1% growth. In case it’s not clear – we have had NO GROWTH. Instead, we had NEGATIVE GROWTH. We are now where we were early in the pandemic, says the Wall Street Journal.
The GDP is suffering from supply chain issues, labor shortages, inflation, and an inept leader in the White House. His economic advisors include Bernie Sanders who is an economic illiterate.
Let’s not forget the seriously damaging lockdowns and the US involvement with Ukraine, now suffering from a Russian invasion. The US, led by the same people who gave us the Afghanistan surrender, is forking over billions to Ukraine to support them.
Personal consumption increased by 2.7% while services spending went up 1.86%. However durable goods (cars, appliances, furniture, et al) spending stagnated.
People are still traveling and they might buy cars if more were available.
As inflation increases, consumer spending decreases. Who knows how that will go. Some economists claim inflation is slowing down. Others say we’re heading for a serious recession.
The WSJ says the drop stemmed from a widening trade deficit, with the U.S. importing far more than it exports. A slower pace of inventory investment by businesses in the first quarter—compared with a rapid buildup of inventories at the end of last year—also pushed growth lower. In addition, fading government stimulus spending related to the pandemic weighed on GDP.
IT’S SHOCKING
Harvard University professor Kenneth Rogoff, a former chief economist at the International Monetary Fund, told “Mornings with Maria” on Thursday that a contraction in the U.S. economy in the first quarter is “shocking.
Rogoff said the Feds would have to increase interest rates to 5% or 6% to avoid a recession and he doesn’t see them doing that. He sees record-high inflation and a recession in our future.
WHY IS HE SHOCKED???
This contraction has economists worried about the fundamental health of the economy.
81 MILLION PEOPLE VOTED FOR THIS
The government spending artificially improves the economy temporarily and then inflation follows.
It’s really sad that the most powerful nation on earth has very incompetent people in charge. Just look at Afghanistan as an example.
You have to love Joe. Does anyone take him seriously? He talks about jobs created but those are jobs returning after lockdowns.
Watch:
Bloomberg’s Jordan Fabian: “[H]ow concerned are you about a recession, given that the GDP report…shows a contraction of 1.4% in the 1st quarter?
Biden: “Well, I’m not concerned…consumer spending & business investment & residential investment increased at significant rates” pic.twitter.com/F37vpjvutU
— Curtis Houck (@CurtisHouck) April 28, 2022
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So a really strange reaction from Wall Street. A major rally in the face of an obvious recession is the last thing we’d expect, but I think I understand it. If the players in the market think that this GDP downturn will stop the FED from aggressively raising the federal funds interest rate then it begins to make sense, but I think they’ve lost sight of the big picture. The inflation rate has to be brought under control and the FED isn’t going to stop raising rates until it does. So, in my opinion this rally today was a mistake and after a night of thinking about it, I doubt tomorrow looks so rosy on Wall Street.
He is another globalist double talker. He is not going to betray the corrupt globalists creating the havoc.
I read someone today saying that any expert who did not realize a massive increase in the money supply in a period of limited production of goods would cause high inflation is crazy. That is ECON 101. They added trillions to the money supply during low growth, and growth should be comparable to the increase in money supply in a stable economy. High prices discourage consumption which hurts growth.
Rogoff is a real chessmaster, he goes on TV to make the moves which favor himself. He knows the USA is sabotaging the economy.
Shocking? How about totally predictable. What else can any sane person expect just by looking at this total incompetence? Anytime Democrats are in office and horrible economic numbers come out the left calls it shocking or unexpected.