Ready for the double-dip?
 

Disappointing data darken economic outlook - Aug 2010
Investors, businesses, consumers hunker down amid signs of slower growth

The outlook for the U.S. economy just went from half-full to half-empty.

The latest economic data out this week confirmed a gloomier forecast issued by the Federal Reserve Tuesday after its regular rate-setting meeting. That has renewed fears of a so-called ?double-dip? recession that are weighing on investors, spooking consumers and slowing businesses from hiring. Many economists argue that a recovery, slow but steady, is still intact. But growth forecasts are falling, and the odds of another contraction are rising.

After a surge in growth late last year and in early 2010, the government estimated last month that gross domestic product grew at a 2.4 percent in the second quarter, down from 3.7 percent in the first three months of the year. But fresher data suggest the economy may have barely grown at all in the quarter, and early results from the current third quarter are not too encouraging. As a result a midsummer stock market rally was abruptly halted this week and the stock market reversed course, dropping about 4 percent in just a few sessions. One troubling indicator came Wednesday, when the Commerce Department reported that the U.S. trade deficit widened in June, as imports surged and exports fell. Economists at Barclays? Capital told clients the report suggested that GDP growth for the second quarter might be revised to as low as 0.3 percent.

Meanwhile the painfully weak job market shows no signs of improvement. The economy has added a paltry 650,000 jobs this year and the official unemployment rate remains at a recessionary 9.5 percent. A report Thursday showed that first-time claims for jobless benefits rose in the latest week to 484,000, the highest total since February. The lack of job growth has put a damper on consumer spending, which still accounts for about 70 percent of GDP and typically drives economic recoveries.

On Friday, the government reported that retail sales edge up in July but mainly due to a rise in gasoline prices. A separate survey on consumer sentiment showed that few of them expect to see the economy improve in the months head. Though consumers continue to pare down debt, they?re still struggling to pay off the huge borrowing spree of the past decade. "We've already taken a trillion dollars of household debt out of the system, either written down, walked away from, or modified," said David Rosenberg, chief economist at the investment firm Guskin Scheff. ?But there's another $6 trillion to go."

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:2 cents: I think these people are either fucked in the head, oblivious to reality, or intentionally trying to lead the sheep into thinking everything is fine so they'll spend the last $5 bucks they have on something useless. No "recovery" was ever seen on the streets where it fucking matters. "Double-Dip"? LOL.... we're still in the massive first dip. We never clawed our way out of it.

Further evidence that Wall Street is entirely disconnected from reality.

this double dip shit pisses me off. any "recovery" just just due to government stimulus. the economic system is hopelessly broken. going to take a decade to fix this shit.

Nice post.


Shit is getting worse and the people that are not feeling it are claiming that it is getting better. This systm is all fucked up.

Bush shitty polices + Obamas shitty policies + federal reserve + big government = depression.

Unfortunately I think we'll see a double dip too. Glad I've got job security

Wall Street is disconnected? Is the White House more or less connected than Wall Street?

Summer Of Recovery

More.

The WH is aware and concerned about unemployment and the economy in general. I don't believe Wall St. gives a fuck one way or the other.

pay no attention to the man behind the curtain

Wall St. has more to lose if the economy tanks than the WH. If history is an indicator a shitty economy helps the democrats and progressives. For example, FDR keeping his job for so long during the depression.

Is that why the W. St. cats are living large and my neighbors are losing their houses? Because W. St. is affected more? Isn't W. St. making money of people going broke as well?

I believe I read statistically more millionaires are losing their homes than the middle class.

The question was Wall St. or the White House.

Queen Obama is living large while your neighbors are losing their homes. Does that bother you? It bothers me a little, but not as much as Obama lying in ever address he has given saying the economy is getting better. Lying so people will go out and spend their last 5 bucks.

Of course Obama is lying about the economy. That's his job. If he told the truth there would be anarchy in the streets.

The millionaires are now just really starting to lose their mansions. The 5-year adjustable peeps. We still have the 7-year folks coming due. But yes, there are $40 million dollar homes on Maui in foreclosure as we speak.

i think we already had the "double dip" as in two terms with Bush.

So his job is to con the American people into spending? :Oh crap Almost makes me miss the days when Bush told us to be patriotic and spend.

Exactly. Bush did the exact same thing, because that's part of the job. "Go shopping, everything is fine."

http://brokenzombie.com/junk_bin/gfy/iraqi_minister.jpg

Yes, I remember good ol' George on tv telling everyone to go shopping.
Spending is what makes the U.S. go 'round. As we know. No spending, no America.

Yeah the last few days here, the UK news has all been about "we might be heading for bad times again".

Umm, when the fuck did we get out of them? People were still losing jobs, homes, etc. But because they told us things were getting better, people suddenly start believing it, even though they still didn't have a job, or money to pay for their mortgage.

Now it will be panic stations again. When really, not much has changed. We were in the shit, we are still in the shit, and we will be in the shit for a long time to come.

Fooling people in a few months again saying things are better will only do more harm than good...

Lets not forget Clinton to...deregulation

Yes, I saw that too: so-called "McMansions" being among the most foreclosed properties

The problem is that being "a millionaire" may make you more vulnerable, due to the lifestyle and expense structure. Folks with more modest incomes may get by with the addition of a second job, but millionaires facing hard times may be truly screwed.

That includes a lot of porn folks that used to have money.

[QUOTE=IllTestYourGirls;17413424]I believe I read statistically more millionaires are losing their homes than the middle class.

The question was Wall St. or the White House.

Queen Obama is living large while your neighbors are losing their homes. Does that bother you? It bothers me a little, but not as much as Obama lying in ever address he has given saying the economy is getting better. Lying so people will go out and spend their last 5 bucks.[/QUOTE

Those millionares losing homes, were more than likely investment properties. The economy is in the shitter and it won't get any better any better any time soon. I own a yacht management company, and even the rich are watching their pennies.

Shit will hit the fan soon enough those who feel it is not getting worse will be the one who suffer most.

Double dip recession + jobless recovery + hedge funds going overseas to ride the declining dollar/increasing index prices to even more profits.

There's a lot of talk of "decoupling" lately. Normally, this is made in the context of the chinese economy turning to domestic demand instead of export markets. There's also a more DANGEROUS form of decoupling--US capital moving to overseas capital markets and making money BETTING AGAINST America.

Anyone who buys into "we're on a road to recovery" is sheep and deserves whatever hardship that comes their way.

I was just reading about the recession of 1920-21 and how they fixed that, I found this line that was interesting

Libertarian paleoconservative historian Thomas Woods argues that President Harding's laissez-faire economic policies during the 1920-21 recession, combined with a coordinated aggressive policy of rapid government downsizing, had a direct influence (mostly through intentional non-influence) on the rapid and widespread private-sector recovery.

http://en.wikipedia.org/wiki/Depress...920%E2%80%9321

The problem is that the McMansions are not being bought by millionaires, but instead people with slightly above average jobs. A friend of mine bought one these types of homes about 2 years ago. He paid 400K for it. It is a nice house with four big bedrooms, custom gourmet kitchen, hardwood, nice fireplace and a huge media room. The builders built an entire subdivision of them and almost all of them were purchased by people like my buddy who make between 80-100K per year.

My buddy pays 3K a month for that house when you include taxes. He makes about 85K per year. After taxes are taken out of his check he brings home about 5K per month. So he actually pays 60% of his income just to his house. He is lucky. He is single (got divorced a few years ago just after buying the house) and his truck is paid off. He doesn't have many other bills other than food, utilities and gas/insurance for his truck so he is getting by. The problem is the value of his house has plummeted. About 40% of the houses in that development are now either for sale or just empty from foreclosure. The value of his house is down to about 320K and falling. It could take years before the value of it ever rises back to where it was so even if he wanted to sell he can't without taking a risk of losing major money and having some serious credit problems because of that.

When I was a kid nobody I knew lived in a house like this. There were only a few houses like this in the town I grew up in and the families that owned them had a nice amount of money. Regular families, even those that had a nice income, lived in normal homes where the mortgage only took up about 30% or less of your income. But those days are gone.

I have said it before and I will say it again. Greed, and a desire for stupid material things has brought about the downfall of the middle class and they did it to themselves. When credit became easy to get people ran out and bought stuff they couldn't afford. They bought bigger homes than they could normally afford which left them with less money to spend on everything else. So they got credit lines for furniture, cars, TV's, vacations and just about anything else they bought. They couldn't afford 3K for a new bigscreen, but they wanted it for the new house and they could afford $100 a month for it and since it was all on credit they got the great surround sound and some nice media chairs to go with it. As more and more people bought these things they couldn't afford it drove the demand and price up for them so everything across the board started getting more expensive and more and more people turned to credit. Half the time you go into a store and the actual price tag of the item is tiny, but the monthly payment amount on the credit line for an item gets a huge, easy to see sign. Forget $1,200, it only cost $35 per month.

It seems like somewhere in the last 15-20 years people forgot how say no to themselves and refused to deny themselves anything. I don't know how many times I have heard people say, "I deserve this . . ." as they buy something nice and expensive that they can't afford. Entitlement, greed, credit and stupidity may well cause the downfall of an entire group of people in this country.

Sorry for the long post :)

Short sellers are loving this climate, its a fucking money making dream to them.

The latest economic data out this week confirmed a gloomier forecast issued by the Federal Reserve Tuesday after its regular rate-setting meeting. That is the latest data out.

Is the government still printing money over there?

I heard the US don't realise one of the basic fundamentals of economics - if you print more money, your money becomes devalued.

Thanks for fucking the US / AUS exchange rate (again). :321GFY

Classic!

EXCELLENT point !



This very basic fact has never been part of ANY political parties policies.


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You have a unique talent for cheering people up.