GDP Shows Surprise Drop for U.S. in Fourth Quarter

[boutons_deux]

one of the very best economic analysts going:

Economy Shrinks -- Here's Why It's Not Bad News ...

http://www.alternet.org/print/econom...s-not-bad-news



and btw

Obama’s Job Approval Hits Three Year High

Fresh off of victory and his second inauguration President Obama has seen his job approval rating soar to the highest it has been since the beginning of his first term. According to a new Washington Post-ABC News poll 60 percent of Americans approve of the job Obama is doing and 37 percent disapprove. Obama’s approval rating had been struck around 50 percent for the last few years but has increased significantly in recent months.

Obama’s inauguration speech also received high markers. The poll found 51 percent approved of the speech and only 24 percent disapproved, with the rest having no opinion.

http://fdlaction.firedoglake.com/201...ree-year-high/

[spursncowboys]

With a shrinking population especially within the realm of 'haves' you can count on it.

What do you mean. There are going to be less people in the upper income? Less rich people?

[TeyshaBlue]

Consumer spending added 1.5 percentage points to GDP, and business investment added 1.1 points (source: Fox news). That's basically a 2.6% uptick from the private sector alone. It's the private sector that will need to pull the economy forward, so that's a positive outcome in my book.

I think most of us can agree that certain government spending needs to be cut, and defense is a fair place to start. Now cutting government spending will drag down the economy, so the net GDP growth going forward might well turn out to be lower than expected. But that's OK in my book as long as the private sector keeps growing. Over the next several months I'll be primarily following the private sector's contribution to GDP. Once a lower, more stable level of government spending is reached, then I'll be interested in the overall GDP number.

Also, another factor in this quarter's GDP drop was the fall in inventories. If consumer demand has grown, businesses will grow inventory, so this is unlikely to repeat. All in all, I think the next quarter will still show a modest overall GDP growth, mostly fueled by private sector consumption and investment.

Nice analysis. Thx!

[boutons_deux]

What do you mean. There are going to be less people in the upper income? Less rich people?

how many millionaires+ have enough kids equal or greater than replacement number?

Certainly most recent college grads with $25K average college debt, and many with much more, won't be buying houses, new cars, or are starting families for many years.

[boutons_deux]

How More Austerity Will Push The U.S. Further Away From Full Employment



http://thinkprogress.org/economy/201...ll-employment/

The Banksters Great (Jobs) Depression continues to screw 10Ms of Americans (Banksters doing OK)

Has any Repug mentioned "23 million unemployed (Obama's fault)" since the Pres campaign was over?

[Wild Cobra]

Another great, laughable link, brought to you by ShazBot.

[boutons_deux]

"buy shazbot"? I'm way out of your price range

[Wild Cobra]

"buy shazbot"? I'm way out of your price range

No...

is cheap, and I don't want any.

[boutons_deux]

No...

is cheap, and I don't want any.

whoa! you're really at the top of your game.

And what makes you laugh at the GDP that is still-cratered by the Banskters?

[Wild Cobra]

whoa! you're really at the top of your game.

And what makes you laugh at the GDP that is still-cratered by the Banskters?

I'm not laughing at the GDP. It's no laughing matter. I'm laughing at your assessment.

[FuzzyLumpkins]

What do you mean. There are going to be less people in the upper income? Less rich people?

A shrinking population in and of itself leads to less economic transactions but by wealth being concentrated into a smaller and ever smaller pool that tends to save their money as it is furthers the issue. Do you think one man with $5m spends more or less than the total of 5 people with $1m each?

[TeyshaBlue]

A shrinking population in and of itself leads to less economic transactions but by wealth being concentrated into a smaller and ever smaller pool that tends to save their money as it is furthers the issue. Do you think one man with $5m spends more or less than the total of 5 people with $1m each?

I've never approached this idea from that angle but I would guess the 5 w/1 million would outspend the single with 5 mill. Rather handily I suspect.

[Capt Bringdown]

Why defense spending plunged 22% last quarter — and killed GDP

Government defense expenditures plunged by a staggering 22.2 percent between October and December. According to the Bureau of Economic Analysis, the Pentagon spent significantly less on just about everything except military pay. Had the Pentagon not cut back on spending, the economy would have grown at a weak but positive 1.27 percent pace.

Was this big plunge in defense spending unusual? Yes and no. To a certain extent, it’s part of a pattern: Defense spending often rises in the third quarter of a year and drops in the fourth quarter.

There’s a reason for this. The fiscal year ends in September, and government agencies typically try to spend all the money Congress allotted them for that year by then — otherwise, they fear, they’ll get a smaller budget next time around.

“In the Pentagon, you have to use it or lose it by the end of the fiscal year in September,” said Lawrence Korb, a former assistant secretary of defense now at the Center for American Progress, in a recent interview. “You see this a lot. ‘We’ve got to fly a lot this month for training, otherwise Congress will take back the money they gave us.’”
- more - >

[Wild Cobra]

Why defense spending plunged 22% last quarter — and killed GDP

Such decreases in my experience are normal... but at the end of the fiscal year, and not to that degree.

The fiscal year and calendar year are not the same Captain!

I suggest something else is likely the case.