This morning, I finished looking at the “regular” news and switched over to my daily scan of Yahoo! Finance, which – I have to say – I normally greatly appreciate.
Today though, I had to roll my eyes when I saw the title it gave to its prominently featured first article: “GDP Revised Lowed; US Economy Grew 1.6% in 2Q, Still Better Than Expected.”
1.6% growth is still better than expected? I thought that we were in the “Summer of Recovery?”
Maybe it’s just me, but that doesn’t sound like any recovery worth mentioning to me.
Let me quote a few key sections of the actual AP article that Yahoo! linked to:
“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, the Commerce Department said Friday. 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.”
“That's ‘very disappointing relative to a normal business cycle,’ he said. ‘Usually you get a bigger bounce back.’”
“Still, stock futures rose modestly after the announcement as investors appeared relieved the estimate wasn't lower as some economist had forecast.”
The “Economic Recovery” in Perspective
Who knows; maybe they really were relieved. After all, it’s a shock we’ve grown at all considering our unemployment rate that only falters whenever people give up looking.
However, it’s also possible that they’re faking that relief in order to keep the markets from plunging, consumers from panicking and U.S. policy critics at bay. So maybe, when they report the night before that “many economists believe the Commerce Department will revise its estimate of growth in gross domestic product to 1.3% or lower,” they’re full of it.
But that’s my cynical side coming out. It isn’t like I have any real reason to mistrust the press; they’ve never purposely led us astray before, right?
All sarcasm aside, former Wells Fargo Chief Economist Sung Won Sohn seems to nail the big picture right on the head just by noting a few very obvious facts: “Housing is in the tank. Confidence is going down. The stock market is going down. It’s hard to imagine how consumers will spend.”
And Gus Faucher, a Moody’s Analytics economist agrees, saying, “The economy is going to limp along for the next few months” and could even slip back into recession.
With little hope for the U.S. future, considering the private sector’s uncertainty about what will happen to the Bush tax cuts among other game changers, it’s no wonder that HSBC and other large banks are “promoting the use of the renminbi to corporate customers instead of the dollar for trade deals with China.”
Meanwhile, back here at home, our officials refuse to really account for our government spending. The Federal Reserve Board, claiming that it wants to protect banks, is still refusing to release who it gave money to and in what amount.
And as for Biden’s boasts about how much good rampant government spending has done for the country so far?
Well, not surprisingly, they fall flat just like our supposed economic recovery.