red states rule
05-26-2011, 08:41 AM
The economy keeps sinking as Obamanomics does it damage.
http://www.powerlineblog.com/archives/assets_c/2010/09/toon_090310-thumb-410x279.jpeg
The first-quarter GDP growth rate plunged to 1.8 percent, a steep change from the previous quarter’s middling 3.1 percent growth rate. Even more ominously, imports increased by 4.4 percent vs. a 2010 fourth quarter decrease of 12.6 percent, and exports hit their lowest number (a 4.9 percent growth rate) since mid-2009. Meanwhile, personal consumption expenditures dropped from fourth quarter’s 4 percent growth rate to 2.7 percent.
The real story, though, comes near the end of the April Commerce Department report. Federal government spending dropped 7.9 percent after staying nearly even in the fourth quarter. National defense spending dropped 11.7 percent. That drop in spending explains why previous growth rates had been artificially inflated. It also explains why jobs have not returned.
Actually, it gets even worse than that. After accounting for inventory growth, real final sales of domestic product (GDP minus changes in domestic inventories) was 0.8 percent — barely above recession level. This indicates that even though sales of durable goods dropped from a 21 percent increase in the fourth quarter to 10 percent in the first quarter of 2011, businesses still overbought — which will negatively impact second-quarter orders and growth.
http://theweek.com/article/index/215082/its-still-all-about-the-economy
and
Home values fell 3% in the first quarter from the previous quarter and 1.1% in March from the previous month, pushed down by an abundance of foreclosed homes on the market, according to data to be released Monday by real-estate website Zillow.com. Prices have now fallen for 57 consecutive months, according to Zillow.
Last year, the housing market showed signs of improving as price depreciation slowed in some markets and stabilized in others. In response, a number of economists began forecasting that housing would hit a bottom in late 2011, then begin to recover. But the improvements, spurred by federal programs that gave buyers up to $8,000 in tax credits, proved fleeting. Sales collapsed when the credits expired last summer, and prices in many markets have been falling ever since.
While most economists expected sales to decline after tax credits expired, the drag on the market has been greater than many anticipated. “We expected December and January to be bad” as the market reeled from the after-effects of the tax credit, said Stan Humphries, Zillow’s chief economist. But monthly declines for February and March were “really staggering,” he said. They indicate “a reflection of the true underlying demand, which is now apparent because most of the tax credit is out of the system, and it’s being completely overwhelmed by supply.”
Mr. Humphries now believes prices won’t hit bottom before next year and expects they will fall by another 7% to 9%. Other economists revised their forecasts. In April, the chief economist at mortgage company Fannie Mae, Doug Duncan, said home prices in the second quarter would be 5.3% lower than the previous-year period, down from his earlier estimate of a 2.6% decline.
http://online.wsj.com/article/SB10001424052748704810504576309532810406782.html
and
Corporate profits contracted in the first quarter for the first time in more than two years and the economy grew at the same pedestrian pace as previously estimated, government data showed on Thursday.
Signs of the economy's struggle to regain speed were highlighted by an unexpected rise in the number of Americans applying for unemployment benefits last week.
"There is no doubt the economy has slowed. We will call the first half of 2011 as a soft patch," said Robert Dye, a senior economist at PNC Financial Services in Pittsburgh. "We should see growth accelerate in the second half in the 3.0 percent to 3.5 percent area."
After-tax corporate profits fell at a rate of 0.9 percent, the Commerce Department said, after rising at a 3.3 percent pace in the fourth quarter.
In its second estimate of the economy, the department said gross domestic product growth was unrevised at annual rate of 1.8 percent, below economists' expectations for a 2.1 percent pace.
http://news.yahoo.com/s/nm/20110526/bs_nm/us_usa_economy;_ylt=ApItnvEsMr_oj1FAo4uibf.yBhIF;_ ylu=X3oDMTJmNW1lbHFrBGFzc2V0A25tLzIwMTEwNTI2L3VzX3 VzYV9lY29ub215BGNwb3MDMgRwb3MDNQRzZWMDeW5fdG9wX3N0 b3J5BHNsawNjb3Jwb3JhdGVwcm8-
http://www.powerlineblog.com/archives/assets_c/2010/09/toon_090310-thumb-410x279.jpeg
The first-quarter GDP growth rate plunged to 1.8 percent, a steep change from the previous quarter’s middling 3.1 percent growth rate. Even more ominously, imports increased by 4.4 percent vs. a 2010 fourth quarter decrease of 12.6 percent, and exports hit their lowest number (a 4.9 percent growth rate) since mid-2009. Meanwhile, personal consumption expenditures dropped from fourth quarter’s 4 percent growth rate to 2.7 percent.
The real story, though, comes near the end of the April Commerce Department report. Federal government spending dropped 7.9 percent after staying nearly even in the fourth quarter. National defense spending dropped 11.7 percent. That drop in spending explains why previous growth rates had been artificially inflated. It also explains why jobs have not returned.
Actually, it gets even worse than that. After accounting for inventory growth, real final sales of domestic product (GDP minus changes in domestic inventories) was 0.8 percent — barely above recession level. This indicates that even though sales of durable goods dropped from a 21 percent increase in the fourth quarter to 10 percent in the first quarter of 2011, businesses still overbought — which will negatively impact second-quarter orders and growth.
http://theweek.com/article/index/215082/its-still-all-about-the-economy
and
Home values fell 3% in the first quarter from the previous quarter and 1.1% in March from the previous month, pushed down by an abundance of foreclosed homes on the market, according to data to be released Monday by real-estate website Zillow.com. Prices have now fallen for 57 consecutive months, according to Zillow.
Last year, the housing market showed signs of improving as price depreciation slowed in some markets and stabilized in others. In response, a number of economists began forecasting that housing would hit a bottom in late 2011, then begin to recover. But the improvements, spurred by federal programs that gave buyers up to $8,000 in tax credits, proved fleeting. Sales collapsed when the credits expired last summer, and prices in many markets have been falling ever since.
While most economists expected sales to decline after tax credits expired, the drag on the market has been greater than many anticipated. “We expected December and January to be bad” as the market reeled from the after-effects of the tax credit, said Stan Humphries, Zillow’s chief economist. But monthly declines for February and March were “really staggering,” he said. They indicate “a reflection of the true underlying demand, which is now apparent because most of the tax credit is out of the system, and it’s being completely overwhelmed by supply.”
Mr. Humphries now believes prices won’t hit bottom before next year and expects they will fall by another 7% to 9%. Other economists revised their forecasts. In April, the chief economist at mortgage company Fannie Mae, Doug Duncan, said home prices in the second quarter would be 5.3% lower than the previous-year period, down from his earlier estimate of a 2.6% decline.
http://online.wsj.com/article/SB10001424052748704810504576309532810406782.html
and
Corporate profits contracted in the first quarter for the first time in more than two years and the economy grew at the same pedestrian pace as previously estimated, government data showed on Thursday.
Signs of the economy's struggle to regain speed were highlighted by an unexpected rise in the number of Americans applying for unemployment benefits last week.
"There is no doubt the economy has slowed. We will call the first half of 2011 as a soft patch," said Robert Dye, a senior economist at PNC Financial Services in Pittsburgh. "We should see growth accelerate in the second half in the 3.0 percent to 3.5 percent area."
After-tax corporate profits fell at a rate of 0.9 percent, the Commerce Department said, after rising at a 3.3 percent pace in the fourth quarter.
In its second estimate of the economy, the department said gross domestic product growth was unrevised at annual rate of 1.8 percent, below economists' expectations for a 2.1 percent pace.
http://news.yahoo.com/s/nm/20110526/bs_nm/us_usa_economy;_ylt=ApItnvEsMr_oj1FAo4uibf.yBhIF;_ ylu=X3oDMTJmNW1lbHFrBGFzc2V0A25tLzIwMTEwNTI2L3VzX3 VzYV9lY29ub215BGNwb3MDMgRwb3MDNQRzZWMDeW5fdG9wX3N0 b3J5BHNsawNjb3Jwb3JhdGVwcm8-