50 economists forecast their estimates for real GDP over the next 6 quarters in a recent Wall Street Journal survey [and their projections, on average, show a modest increase through to the end of 2012 as the table below shows. In addition, they were asked] to forecast… the probability of a recession in the U.S. in the next 12 months] and the results were quite surprising – quite. Let me show you.] Words: 600
October 25th, 2011 | Posted in Economic Overview,Economy | Read More »
The widespread stagnation in wages, rather than the level of unemployment, may offer a better explanation for the failure of economic growth to accelerate two years after the end of the recession. Workers’ ability to negotiate higher earnings won’t return until the job market strengthens, and flagging confidence has raised the risk that consumers may retrench. [Let us explain.] Words: 1018
September 21st, 2011 | Posted in Economic Overview,Economy | Read More »
The new [debt ceiling deal] legislation will add $2.4 trillion to the $14.3 trillion national debt in a little over a year – and we don’t even start saving money until after the debt reaches $16.7 trillion! This bill doesn’t even cut the deficit. It just slows the growth of government spending to around 8% a year! So, even if Congress cuts $2.1 trillion out of the budget over the next 10 years, we will still be running annual deficits of more than $1 trillion…[That means that in addition to a deficit that will continue to grow we can look forward to a shrinking economy, an imploding U.S. dollar and exploding inflation. Some future! Let me explain.] Words: 827
July 31st, 2011 | Posted in Debts/Deficits,Economy | Read More »
Many investors believe the market will rise if the economy is growing and sink if it’s shrinking but that is the wrong way to think about it. Instead, the real focus should be on whether the economy is growing at a slow pace or a moderate pace. Indeed, with 2% growth, the stock market could steadily fall. Yet with 3% Gross Domestic Product (GDP) growth, the market could surge. The difference between 2% and 3% may not seem like much, but it is. [Let me explain.] Words: 730
July 9th, 2011 | Posted in Asset Allocation,Economy | Read More »
Most economists see the latest Q1 GDP stumble as a blip, something we shouldn’t worry about because the economy is still on track for recovery…[but] another way to look at it is that the economy is being harmed by monetary inflation and we are seeing massive distortions in the economy as a result of this intentional Fed policy – economic growth is stalling and industrial production, manufacturing, non-manufacturing, durable goods production, retail sales and employment is flattening-to-declining… I think this is the correct way of looking at things and, [as such,] Q1 is not a temporary blip on the road to recovery… [but another mile down the road to economic stagflation, price inflation, lower real estate prices, continuing high unemployment, a weaker dollar, higher taxes and more - much more! Let me explain.] Words: 2997
June 5th, 2011 | Posted in Economic Overview,Economy | Read More »
[A look below at the trend in the U.S.'s share] of world GDP (data here) from 1969 to 2010… [shows an] amazingly stable share of world output which has remained [constant at 26.3%] for more than forty years…[and] is a testament to how America’s dynamism, resiliency, and culture of innovation and entrepreneurship have enabled us to be productive in a tough world. [Let me expand on this further.] Words: 730
June 3rd, 2011 | Posted in Economic Overview,Economy | Read More »
The U.S. Federal government deficit for fiscal year 2011 has just been revised upwards by a further $378 billion to a whopping $1.645 trillion. As of January 2011, the total outstanding debt of the U.S. Federal government is $14.131 trillion. These numbers are huge, Huge, HUGE but Americans believe there is really no need to worry that much about such astrnomical numbers because they all know that it’s going to get much, much worse. They all know that there’s no sense worrying about this little milestone on the road to hell. Words: 1016
February 24th, 2011 | Posted in Debts/Deficits,Economy | Read More »
As the United States debates its economic future in light of large government budget deficits, it is important that the public [understands that] before we can reach the point where the government can spend less, the country must go through a period where the government spends much more wisely. To simply slash government spending now would result in a depression in the United States and around the world. [Let me explain.] Words: 1251
January 24th, 2011 | Posted in Debts/Deficits,Economy | Read More »
What happens when the stimulus is over and the Fed begins to tighten again? Where will demand come from to get Main Street back, create jobs, raise middle class wages? Not from big businesses. Certainly not from Wall Street. Not from exports. Not from government. So, where? That question is the big unknown hanging over the U.S. economy. Until there’s an answer, an economic “recovery” for anyone other than big corporations, Wall Street, and the wealthy is a mirage. Words: 1279
June 24th, 2010 | Posted in Economic Overview,Economy | Read More »
Pushing the big problems into the future appears to have been the working strategy for both the Fed and recent Administrations, yet the U.S. dollar and the budget deficit do matter, and the future is at hand. The day of ultimate financial reckoning has arrived, and it is playing out. Words: 1096
March 8th, 2010 | Posted in Inflation/Deflation | Read More »
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