The Economy

[MajorRewrite]

I’ve been posting economic news in the “Thanks Biden” thread, but I think it’s time for a new dedicated thread.

Let’s begin with today’s good economic news:

US economic growth increased last quarter to a healthy 2.8% annual rate

The nation’s economy accelerated last quarter at a strong 2.8% annual pace, with consumers and businesses helping drive growth despite the pressure of continually high interest rates.

Thursday’s report from the Commerce Department said the gross domestic product — the economy’s total output of goods and services — picked up in the April-June quarter after growing at a 1.4% pace in the January-March period.

Good news indeed.

The economy is cyclical so an eventual downturn is inevitable, but it’s not here yet.

I’m sure all Americans will be pleased by the continued strength of the economy.

 

[MajorRewrite]

I meant to add that the same article reported that inflation continues to cool:

The GDP report also showed that inflation continues to ease, while still remaining above the Federal Reserve’s 2% target. The central bank’s favored inflation gauge rose at a 2.6% annual rate last quarter, down from 3.4% in the first quarter of the year. Excluding volatile food and energy prices, so-called core PCE inflation increased at a 2.9% pace. That was down from 3.7% from January through March.

And business investment is up:

Business investment was up last quarter, led by a 11.6% annual increase in equipment investment.

So many good signs.

https://apnews.com/article/economy-...eral-reserve-ffba812f747d18d1f09fcf804fe4eceb

 

[ll74]

I think the best thing that you can do when exploring the economy is to look at metrics you haven't.

For example - what is the wage growth versus inflation month over month?

https://www.statista.com/statistics... inflation exceeded,wages grew by 4.7 percent.

There are a lot of governmental set metrics which are released to news outlets as a measure of the economy (GDP for instance) but when you get down to ground level, inflation is a better indicator of our economic happiness.

 

[MajorRewrite]

I think the best thing that you can do when exploring the economy is to look at metrics you haven't.

For example - what is the wage growth versus inflation month over month?

https://www.statista.com/statistics/1351276/wage-growth-vs-inflation-us/#:~:text=U.S. inflation rate versus wage growth 2020-2024&text=The rate of inflation exceeded,wages grew by 4.7 percent.

There are a lot of governmental set metrics which are released to news outlets as a measure of the economy (GDP for instance) but when you get down to ground level, inflation is a better indicator of our economic happiness.

My post did report inflation, but your graph that includes wage growth is definitely good news.

As for economic growth (GDP growth) vs inflation … the Great Depression certainly didn’t have inflation (deflation actually).

A strong economy has GDP growth, job creation, low unemployment, wage growth and low inflation. Fortunately we’re in a good situation right now.

 

[ll74]

My post did report inflation, but your graph that includes wage growth is definitely good news.

As for economic growth (GDP growth) vs inflation … the Great Depression certainly didn’t have inflation (deflation actually).

A strong economy has GDP growth, job creation, low unemployment, wage growth and low inflation. Fortunately we’re in a good situation right now.

Inflation being positive is still inflation and therefore prices aren't coming down. Worth understanding that as well.

 

[MajorRewrite]

Inflation being positive is still inflation and therefore prices aren't coming down. Worth understanding that as well.

Sure, but economists are very opposed to falling prices because the last sustained period of deflation in the US was the Great Depression. Overall falling prices cause trouble for an economy.

Of course that’s why the Fed targets a 2% rate of inflation instead of 0%. It provides a safety margin.

 

[ll74]

Sure, but economists are very opposed to falling prices because the last sustained period of deflation in the US was the Great Depression. Overall falling prices cause trouble for an economy.

Of course that’s why the Fed targets a 2% rate of inflation instead of 0%. It provides a safety margin.

And again - that's why it's important to understand the different dimensions of the economy. When it comes to the people who live here, rising prices that don't ever not rise is not a target. So while the Fed can be happy, the people are not.

 

[MajorRewrite]

And again - that's why it's important to understand the different dimensions of the economy. When it comes to the people who live here, rising prices that don't ever not rise is not a target. So while the Fed can be happy, the people are not.

Okay. Recognizing the danger of deflation to the economy is why the Federal Reserve is run by economists instead of politicians.

 

[MajorRewrite]

Inflation at 2.6% over the last 12 months.

The core Personal Consumption Expenditures (PCE) index, which strips out the cost of food and energy and is closely watched by the Federal Reserve, rose 2.6% over the prior year in June.

Fed’s preferred inflation gauge

 

[Buffalogurl]

https://citizenwatchreport.com/us-banks-experiencing-rising-unrecoverable-debt/#google_vignette
The banks are having trouble?.... Imagine that...

 

[Buffalogurl]

https://www.msn.com/en-us/money/other/ar-BB1qBWzC?ocid=socialshare... here's some mainstream news of the health of the economy....

 

[stxjimmy]

https://citizenwatchreport.com/us-banks-experiencing-rising-unrecoverable-debt/#google_vignette
The are having trouble?.... Imagine that...

How nice for you that you can find a spot of bad news amongst all the optimistic signs above.

 

[ll74]

How nice for you that you can find a spot of bad news amongst all the optimistic signs above.

Noticing trends is part of economic outlook.

The economy is never happy and stable.

 

[Buffalogurl]

https://www.dailymail.co.uk/yourmon...e-goods-chain-bankruptcy-500-stores-risk.html
More signs of a changing economy....

 

[ll74]

https://www.dailymail.co.uk/yourmon...e-goods-chain-bankruptcy-500-stores-risk.html
More signs of a changing economy....

The pandemic really changed so much of our world. Big box stores are making way for smaller regional stores. I think this is a positive and good sign. It also gives more opportunities for entrepreneurs.

Now if we can just get these interest rates down

 

[MajorRewrite]

https://citizenwatchreport.com/us-banks-experiencing-rising-unrecoverable-debt/#google_vignette
The banks are having trouble?.... Imagine that...

Your article is dubious.

If the banks in the article are truly struggling why are they reporting excellent profits?

Citigroup profits: up 10% over the last 12 months

Goldman Sachs profits: up 150% over the last 12 months

 

[MajorRewrite]

https://www.dailymail.co.uk/yourmon...e-goods-chain-bankruptcy-500-stores-risk.html
More signs of a changing economy....

Did you read the article?

Conn’s bought another chain (Badcock) …

But that saddled the company with debt and high overhead costs, Bloomberg reported.

Management’s stupid decision to load the company with debt caused losses and bankruptcy.

Management stupidity is not something you can blame on the overall economy.

 

[stxjimmy]

https://www.dailymail.co.uk/yourmon...e-goods-chain-bankruptcy-500-stores-risk.html
More signs of a changing economy....

More of a sign of excessive borrowing, $1bn for a furniture store sounds like gross mismanagement.

 

[stxjimmy]

Did you read the article?

Conn’s bought another chain (Badcock) …



Management’s stupid decision to load the company with debt caused losses and bankruptcy.

Management stupidity is not something you can blame on the overall economy.

Reading the articles they post seems optional, its headlines all the way.

 

[Buffalogurl]

Did you read the article?

Conn’s bought another chain (Badcock) …



Management’s stupid decision to load the company with debt caused losses and bankruptcy.

Management stupidity is not something you can blame on the overall economy.

I'll agree with you in this instance.... also the interest rates are crippling the housing market...... but thing is I've witnessed them higher, but the wages kinda were keeping up with inflation...

 

[Buffalogurl]

The pandemic really changed so much of our world. Big box stores are making way for smaller regional stores. I think this is a positive and good sign. It also gives more opportunities for entrepreneurs.

Now if we can just get these interest rates down

I'm with you on this I want regionally based stores, as well I always go to my local mom &pop stores first if I can....

 

[MajorRewrite]

I'll agree with you in this instance.... also the interest rates are crippling the housing market...... but thing is I've witnessed them higher, but the wages kinda were keeping up with inflation...

The housing market is weird.

Home sales were down 5.4% in June compared to June of 2023.

But the median home sale price went up 4.1% to a record $426,900.

People blame high interest rates for the slowdown in home sales, but sky-high asking prices for houses are more to blame I think. Both certainly weigh down the market.

https://www.nar.realtor/newsroom/ex...an-sales-price-jumps-to-record-high-of-426900

Disclaimer: I build houses for a living. Our niche in the market is small-ish homes. Our homes are some of the most affordable new homes available in our region and we have a waiting list of people who want to buy.

 

[astuffedshirt_perv]

US economic growth increased last quarter to a healthy 2.8% annual rate

Good news indeed.

It's not just that the US economy is growing at a healthy rate, it is also that the EU isn't growing and China is wandering to a recession. US economic growth has just been incredible during the Biden administration. As the Fed lowers rates, more rocket fuel on this amazing period of growth!

 

[SmokingFap]

I can't remember which moron on here was banging the drum for recession. You know, the one who doesn't even know the definition of it? Anyway, nearly 3% GDP growth is NOT a recession. Of course Fox News, like MAGA, doesn't believe facts.

 

[MajorRewrite]

I can't remember which moron on here was banging the drum for recession.

Censurat/ExxWhyZee/snailspace is the guy who started a thread about how the US economy was already falling into a recession. Which it isn’t, as you pointed out.

I’m sure you’re shocked it was him.