Latest growth data show recovery losing steam

[Amerigo Vespucci]

Source: MSNBC

WASHINGTON — The economy grew at a much slower pace this spring than previously estimated, mostly due to the largest surge in imports in 26 years and a slower buildup in inventories.

The data are the latest sign that the economic recovery is losing steam.

The Commerce Department said Friday the nation's gross domestic product — the broadest measure of the economy's output — grew at a 1.6 percent annual rate in the April-to-June period. That's down from an initial estimate of 2.4 percent last month and much slower than the first quarter's 3.7 percent pace. Many economists had expected a sharper drop.

“I don’t think there’s any question that the economy has softened over the last 90 days or so and I think we are all concerned about that,” St. Louis Federal Reserve Bank President James Bullard told CNBC Friday.

Read more: http://www.msnbc.msn.com/id/38878553/ns/business-eye_on_the_economy/

[beforeyoureyes]

1. "Largest surge of imports in years"....

Chinese crap

We don't make hardly anything anymore. It is pretty scary that we have rendered ourselves dependent on the Chinese for our goods, and rendered ourselves helpless to meet our own needs.

[AndyA]

2. America must stop shopping at Walmart, buying foreign cars, and demanding

American-made goods.

People are literally shopping themselves out of jobs, and they're too stupid to realize it.

They buy a foreign car because it's so dependable, but they can't see they are supporting a foreign corporation when they do.

Americans are stupid, selfish, and they can't see what their actions are doing. There was a time when having a foreign car in your driveway was almost an embarrassment. And it should be today, too. We can't expect to have jobs in this country when everything we spend goes offshore to support a foreign corporation.

[Lightning Count]

4. Wish I could rec your post. nt

[Abq_Sarah]

15. When an American car company

Produces the equivalent of a Subaru Outback, I'll be more than happy to consider it.

[KoKo]

8. And...Financial Sites say Consumers aren't buying...so why is so much being imported?

This doesn't make sense.

[FMBM]

17. Well, some of it is "Chinese Crap"...

But some of it seems a very good cost/benefit purchase... except that it was made so by abusive labor practices in China... it seems that given appropriate government policies and American ingenuity and productivity, we would again be able to produce a lot of this here... it's time for the US to get serious, and get competitive... at least to our own consumers...

[OmahaBlueDog]

3. It'll be interesting to see what holiday spending is like this year.

Unsold home inventories are dropping, but we're still seeing a lot of foreclosures and not a lot of home building.

The first big wave of baby boomers turns 65 next year. Will that translate to home sales in Florida and Arizona? Will they be putting off retirement? How many start retiring early?

[Amerigo Vespucci]

10. Most of the merchants I know are terrified of the coming holiday season

I have one client whose work is scheduled to be finished over the next few days. She has an online store, I just finished redesigning it and she is on pins & needles over having it finished by September 1st. That's when the push for holiday sales begins. Like many online merchants, her sales so far in 2010 have really taken a beating. She needs strong holiday sales or she's going to be in serious trouble.

I also am in talks with a local mall to do a "directory" Website...one page for each merchant (approximately 35) and links to the stand-alone Websites of merchants that have them. They wanted this done by September 1st, but the executive of the property management company that is making the decision took the month of August off for vacation. I'm scheduled to meet with him after the 1st, but launching the site on October 1st won;t really give the merchants the traction they need to make an impact for the holidays. It WILL help...it just would have helped a hell of a lot more if it could have launched on September 1st.

[OmahaBlueDog]

16. Without giving away personal info - in what part of the US do you live?

I am in a profession where I speak to a lot of heads of businesses. These are businesses across the spectrum: manufacturing, services, retailing, wholesaling, transportation.

None of them are happy, and the majority I visit have FAUX Noise or Rush piped in all day to reinforce their misery. That said, it doesn't seem as dead as this time last year. I do see machine & fab shops doing business - albeit with reduced workforces after laying off last year, but they seem busy. Some would even like to hire, but are "uncertain" about where we're headed. It's ironic - they worship Reagan, who was an optimist, but they've become the doom-and-gloomers.

Businesses that depend on the construction industry are still in very dire straits. I've been to truss shops that look dead. Tool repair shops specializing in power tools are struggling. Howeve, farm equipment manufacturers and their supply chain seem to be holding their own. In the Midwest, Corn farmers (exception: those impacted by flooding - especially Iowa) look to do OK; soybean farmers will do pretty well; some wheat farmers are going to make major money.

I'm imagining a lot of people will be trying to get all of the seasonal work they can take on. I know we'll be tightening our belts, but I'm hoping that, overall, the Holidays won't be as bad as everyone thinks they will be.

[Turbineguy]

5. From CNN Pre-Market:

"Economic growth was lowered, but the downward revision wasn't as sharp as we were expecting, so that's being perceived as a positive sign," said Art Hogan, chief market strategist at Jefferies & Co. "We also saw that consumer spending was revised higher, so there are some silver linings in the report."

Economy: The government revised its reading of second-quarter gross domestic product to 1.6%. That was down from the previously reported 2.4%, but still topped expectations.

Economists surveyed by Briefing.com were expecting economic activity to slow to 1.4%.

Separately, the Reuters/University of Michigan index of consumer sentiment for August is expected to have risen slightly to 70, from 69.6 in July.

[Turbineguy]

6. Fidelity Investments doesn't seem

to be getting with the program either. They are saying no double dip.

https://guidance.fidelity.com/viewpoints/bumps-in-road

[TheWatcher]

14. It's pretty much Propaganda VS. Reality these days.

Unfortunately most of America is addicted to fake reality, so they are going to believe the Propaganda, because it makes them feel good, warms their need for fake political victory and theater, and cocoons them from the consequences that are really present all around them.

In short, they not only can't handle the Truth, they will do everything in their power to convince themselves and others that it doesn't exist.

What a sad, cowed, Broken nation we've become.

Anyone who gets their "reality" from CNBC or other venues of endless "happy talk" is a foolish sheep begging to be slaughtered at this point.

It's becoming pretty obvious that their never was a "Recovery" to begin with.

See Post #9 for actual reality.

[Dr.Phool]

7. Roubini says expect GDP growth close to zero in Q3.

[earthside]

9. What 'recovery'?

Let's be clear about this: there hasn't been a 'recovery' for middle and working class Americans.

This so-called 'recovery' has been statistical and any 'growth' largely the result of interest rate manipulations by the mega-transnational corporations and the Federal Reserve.

There has only been one 'dip' since the stock market crash of September 2008 ... a 'double dip' is a fiction.

And, as long as the White House and its economic team continues to believe and talk about the mirage of a 'recovery' among the middle and working class, well, they are going to look out-of-touch and kind of delusional. That's a prescription for electoral disaster -- better to simply own up to the truth and promise to keep trying and do better in the future.

[Amerigo Vespucci]

11. I've got "boots on the ground" seven days a week in Silicon Valley

I've mentioned this before but I am a sole proprietor, which means I am also my "sales force"...if I don;t go out and hustle and bring in the business, there is no business.

I also have friends and colleagues who are full-time, professional salespeople.

From where I stand, you are absolutely correct: "there hasn't been a 'recovery' for middle and working class Americans."

I just see a lot of very frightened business owners.

One friend sells insurance. His commissions are down 50% from last year. He insures businesses, among other things. Several of his long-term clients have told him that they are on the verge of going under. When they do, there's more subtracted from his bottom line.

All of these frightened people aren't spending, and if they are, they aren't spending like they used to.

Some people rise above it. One of my clients is an extremely affluent restaurant owner. He's been on four two-week trips to Maui this year, with a fifth planned, and purchased a brand new, fully loaded Ford SUV. In past years he was one of my best clients. He hasn't given me a single bit of work since August 2009. When I see him he cries about how bad business is and how bad the economy is as he packs his bags for the next trip to Hawaii.

[lib2DaBone]

12. Thanks for info.. good post. The free traders kill business...

soil their own nests.. then complain about no business?

Same as the Repukes.... always vote aginst their own best interests.

I think it is a deep-seated Supply-Side psychosis.. buried so deep in our Reganesque society... that even if the solution was 100 feet tall and surrounded in red neon lights.. our leaders would be unable to see it.





Coach Geithner sends in plays from the sidelines.. the Goldma-Sachs playbook..

[OhioChick]

13. No "recovery"going on here....

"due to the largest surge in imports in 26 years"

That should be a fucking wake-up call.