Friday, September 2, 2011
(Reuters) - President Barack Obama sharply cut estimates on Thursday for U.S. economic growth, underscoring the difficult challenge he faces in spurring a stronger recovery and creating more jobs.
In a midyear review of his annual budget, Obama predicted average unemployment of 9 percent in 2012, when he will have to fight for re-election. The president will give a major speech on Sept. 8 on how he plans to lift hiring and growth.
But in this bizarro world, I wouldn't be surprised if Wall St find this to be good news, and reason to rally with the expectation that the Fed just must create still more money!
Thursday, September 1, 2011
Zero Hedge give us some details:
"The problem is that the beat was once again on purely artificial data, with Inventories and Customer Inventories posting the largest increase in the month, or basically the two most hollow economic series. Far more important - Production, dropped to 48.6, the lowest since May 2009. Another Pyrrhic victory was the increase in imports and decrease in exports: we all know what that means for GDP."
from Wall St Journal:
Stock futures are rallying for some strange reason, though the morning’s plate of economic data was sort of ugly.
Jobless claims came in at 409,000, just a little higher than the 407,000 economists expected. The prior week’s claims were revised up, as they always are, to 421,000 from 417,000. This level of claims is really too high.
Second quarter productivity was revised down to a decline of 0.7%, the biggest drop since the fourth quarter of 2008, from a first reading of -0.3%. It has fallen for three quarters in a row, for the first time since 1979.
from Yahoo Finance:
WASHINGTON (AP) — Worker productivity in the United States fell this spring more quickly than previously estimated while labor costs were rising at a faster clip. Both developments could pose threats to a fragile economic recovery.
The U.S. Labor Department reported Thursday that productivity declined at an annual rate of 0.7 percent in the April-June period, a bigger drop than the 0.3 percent decline reported a month ago. Labor costs rose at an annual rate of 3.3 percent, faster than the 2.4 percent increase originally reported.
The changes reflected downward revisions made last week to overall economic growth which showed the economy's output barely growing in the spring. Declining productivity, if it persists for a prolonged period, would represent a serious economic threat while rising labor costs would cut into corporate profits.
Wednesday, August 31, 2011
from Zero Hedge:
There is the CPI... and then there is the MIT's billion price project which, as the name implies, tracks the prices of a billion products in real time. And according to the latter, annual inflation has hit a multi year high of about 4%. Perhaps someone can advise the talented Mr Evans that the 3% inflation he would so love to achieve... has in fact been eclipsed. At least, according to the real world. So take 4% inflation, add $2.5 trillion in "much more" easing, and what you get is only an economic Ph.D.'s guess. Alas, we are unqualified to have an opinion on the matter.
They are therefore ignoring the strong likelihood of another recession that is already under way, and are instead placing their bets... on more inflation. They are therefore bidding higher the stock market, even in the face of a growing chorus of evidence in support of the view of a new recession.
This is going to have terrible results, because the higher cost of the inflation that the Fed denies is going to contribute toward, and even accelerate the onset of that recession. The Fed, in its refusal to acknowledge its destructive role in driving us toward that cliff, is advancing the very scenario it claims it wants to prevent. By pursuing a policy that now has an evidentiary history of raising inflation and putting greater pressure on household budgets, they are increasing the likelihood of that recession. It's a classic case of shooting oneself in the foot.
And like the Fed, they either still don't get it, or, as I believe, don't care about the destructive consequences! They don't care because higher inflation and monetary policy that causes it serve their interest. They therefore pressure the Fed to create still more of it despite that it harms their countrymen and advances the very economic scenario that we are now dreading.
Tuesday, August 30, 2011
from Zero Hedge:
August consumer confidence plummets from 59.2 to 44.2, far below consensus of 52, dropping to its lowest level since April 2009... And even uglier is the 6 month outlook chart which collapsed from 74.9 to 51.9, one of the biggest monthly drops in history.
Monday, August 29, 2011
Grains are at similar levels to the commodity bubble of 2009, but there is no media coverage any more. These charts are today's chart for soybeans. Other food commodity prices are similarly leaping higher.
Daily chart -- that trend doesn't look "transitory" to me!
from Zero Hedge:
The second economic disappointment of the day comes from the Dallas Fed, which dropped from -2.0 to -11.4 on expectations of -9.0- this was the 4th consecutive negative print month. The report was, in a word, horrible, with just 2 of the 15 constituent indices posting an increase, and the bulk solidly in the red, led by Unfilled and New Orders which dropped 16.8 and 11.2, respectively: not good for economic growth. On the employment side there was nothing good either, with both employment and hours worked declining by -6.7 and -10.1, respectively.