Biz

The Q2 Surge: Is It Coming?

WILL ECONOMY REBOUND? A month ago this website took a look at spending data from April and May – the first two months of the second quarter of 2014.  Was it good?  Um, no.  It was not … which is bad news for an economy supposedly on the cusp of a bounce…

WILL ECONOMY REBOUND?

A month ago this website took a look at spending data from April and May – the first two months of the second quarter of 2014.  Was it good?  Um, no.  It was not … which is bad news for an economy supposedly on the cusp of a bounce back from a disappointing start to the year.

To recap: America’s gross domestic product shrunk at an annualized rate of 2.9 percent from January through March – which the vast majority of economists blamed exclusively on unseasonably cold temperatures (damn that global warming).  That’s the biggest non-recessionary drop in nearly seven decades … assuming we’re not in another recession already.

Anyway … the second quarter is supposed to mark a return to growth, and most analysts are predicting government’s initial GDP estimate to come in at around three percent.

We hope they’re right … growth is good.  No matter who gets the credit for it politically.

But given the data we’ve seen, a three percent annualized expansion is going to be very tough to achieve.  Economist Gary Shilling agrees – noting that “the herd is likely to be disappointed.”

“Consumer spending is 69 percent of GDP and it barely grew in the quarter,” Shilling writes on his website. “According to monthly data, real consumer spending fell 0.2 percent in April and 0.1 percent in May. June’s numbers aren’t released yet, but based on the correlation with retail sales, which are available for June, real consumer outlays rose just 0.1 percent. The jump in March from weak January and February gave consumer spending a higher starting point for the second quarter so we believe it rose 1.3 percent from the first quarter.”

Shilling also cites a decline in full-time employment, weak residential construction and home sale data and lower-than-expected exports as contributing factors to a disappointing print.

“Barring a big jump in inventories, the second quarter real GDP growth was probably a lot closer to 1 percent than 3 percent,” he concludes. “It could even be a negative number.”

Ouch …

Also it’s important to remember government’s initial GDP estimate is often wildly inaccurate (typically overstating economic activity).  For example the initial read on first quarter GDP was 0.1 percent growth .  That was later revised to a one percent drop – and then a 2.9 percent drop.

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9 comments

GrandTango July 28, 2014 at 1:12 pm

You idiots keep hoping and praying for some sign your idiot lord-god is not a total F*#k up.

But remember you cannot have contempt for your people, and exact revenge, and expect good things to follow. You fail because you are lairs, and you hate. Not to mention you are incompetent and stupid.

IOW: There ain’t no Coup de-ville in a Cracker Jacks box….but I’m sure FITS will keep praying for one. But false gods often will leave you empty.

Reply
Brick Tamland July 28, 2014 at 1:33 pm

My Dr. recommends Xanax for these type fits.

http://anxiety-rx.com/images/coupon/xanax-anxiety-rx-coupon.png

” I’m Brick Tamland. People seem to like me because I am polite and I am
rarely late. I like to eat ice cream and I really enjoy a nice pair of
slacks. Years later, a doctor will tell me that I have an I.Q. of 48 and
am what some people call mentally retarded.”

Reply
Dave Chappelle July 28, 2014 at 2:37 pm

You mad bro?
Do you kiss your mother with that mouth?
Stay classy!

All the Best!

Reply
Nölff July 28, 2014 at 3:16 pm

Who wants to FIGHT?
Summon lightning bolt lvl. 5000

??????????
HIIIYYYYAAAAA!!!!

Reply
Ken Masters July 30, 2014 at 5:07 pm

Dragon Punch!

Reply
Tangy's Mama July 28, 2014 at 1:19 pm

Be advised, GrandTango just got the traffic results of his page thingy and seems to have gone right off of his meds. His pseudo cursing and rages are at an all-time high. Please do not antagonize the %&^$ monster. He already kicked all the windows out of the trailer that the Church of God fellers installed after the last episode.

Reply
Just another guy July 28, 2014 at 3:03 pm

Why don’t we take a look at corporate earnings. So far in the 2nd quarter based on the companies who have reported (49%) Revenues are UP 4.9% and Net Income is UP 8.2% year over year. Tax Revenue is UP 8.25% for a year ago. Yeah, so the economy sucks ass with those types of increase.

Reply
Crooner July 28, 2014 at 3:27 pm

“Consumer spending is 69% of GDP.” We are a consumer economy. The problem has been that consumers don’t have the money to spend, because all of the wealth now goes to the 1%. And if the 1% gets another ten grand he don’t run right out and spend it. Spreading the money around helps everybody.

Reply
Crooner July 28, 2014 at 3:27 pm

“Consumer spending is 69% of GDP.” We are a consumer economy. The problem has been that consumers don’t have the money to spend, because all of the wealth now goes to the 1%. And if the 1% gets another ten grand he don’t run right out and spend it. Spreading the money around helps everybody.

Reply

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