Dude! Where's my recession?

[John Coffey]

http://biz.yahoo.com/ap/080529/economy.html?.v=21

[Bob Beamesderfer]

.9 growth? Whoopeee!

[George Schilling]

Dude! Where's my recession?

Officially, just around the corner John. But unfortunately, for most of America, it's already here. ;)

Lowering interest, while popular here, has weakened the dollar and stiffled foreign investment. Were it not for the fed proping up the economy with low interest rates, we would have sunk into a recession already followed by a strong recovery. Instead, were muddling along as we are now and we will still see a declared recession with a weak recovery. I just hate it when government meddles.

[Tom Tanquary]

Hey, I agree with George.

[Steve Ekstrand]

If you're worried about Jobs, the weak dollar is your friend.
Its inflation that is the drawback of a falling currency. If you want to protect wealth and target a low inflation number then you're screwing over job growth to do it. That's horribly Phillip's Curve simplistic. And there are lots of very good arguments that in most times that curve no longer works. This time is not one of those. Its crystal clear.

[Curt Luther]

My quarterly "$1,500 handshake" has been only $800 the past two quarters. That's my recession. Luckily, I got the $800 this quarter for being a "top performer". Others only got $300. That's their depression...

[John Coffey]

Read GDP growth year over year:

http://gregmankiw.blogspot.com/2008/05/gdp-growth.html

[Tom Tanquary]

Read GDP growth year over year

I find this interesting. Can anyone explain why things are getting dramatically worse then? With gas at now well over $4/gal and diesel at $5, the housing crash, etc, how can GDP be on an up swing? I can find no where on the net anything about business getting better in any sector except oil of course.

[John Coffey]

All the "emotional" indicators are down with Consumer Confidence being the best indicator of that. IMHO, 90% of that confidence drop is a result of the drop in housing values and the large number of news stories covering this issue. I'm not blaming the media at all for covering a huge story that directly affects so many people. The economy and consumer confidence is remarkably similar to what went on in 1991/92 when we had a similar (although less sharp) drop in housing prices during a Presidential election cycle.

Gas prices have always felt high when they break some aritifical number barrier. I remember my dad blowing his top and trading his T-Bird for a Mustang when gas topped 50 cents per gallon. In the late 1970s when gas topped $1.00 per gallon there were scores of predictions of economic disaster. If we adjust for inflation, gas prices are similar to where they were in the late 1970s when it busted past $1.00 per gallon. We've actually enjoyed a couple decades of cheap gasoline and now that appears to over.

http://www.randomuseless.info/gasprice/gasprice.html
http://zfacts.com/p/35.html
http://www.inflationdata.com/inflation/ ... _chart.htm

Normally Late May and early June are the high points of gasoline prices for the year. I'm thinking we've seen the top for this year.

[John Coffey]

BTW... BetaMotorsports, LLC is doing better this year. We've even updated our web site! http://www.betamotorsports.com. Two other specialty automotive shops in my business complex are doing better this year as well along with two landscape companies, a laser cutting shop, an envelope printer, a sandwich shop, Chinse product importer, and a tile engraving business. The two construction related businesses in my complex are having a tough time, generally bidding 30 cents on the dollar compared to 2006/2007.

[George Schilling]

There is not doubt about it, the spending power of the average American has been greatly reduced. People were using home equity to finance spending sprees. Now that's gone. And even people who have equity that might ordinarily tap into it, are leary. It has definately had an impact. Also, were it not for inflation, we would have been negative this quarter. People are spending the same but receiving less for their money. The dollar volume may not show it, but we are producing less and consuming less. Thankfully, the falling dollar has propped up exports which has certainly helped with the trade deficit and has kept the economy from faltering further. This economy hurts those that live pay check to pay check. For those who have attained finacial independence, it's a small blip. I don't think the ubber rich even know the average American is hurting right now.

[Bill Schenker]

There is not doubt about it, the spending power of the average American has been greatly reduced. People were using home equity to finance spending sprees. Now that's gone. And even people who have equity that might ordinarily tap into it, are leary. It has definately had an impact. Also, were it not for inflation, we would have been negative this quarter. People are spending the same but receiving less for their money. The dollar volume may not show it, but we are producing less and consuming less. Thankfully, the falling dollar has propped up exports which has certainly helped with the trade deficit and has kept the economy from faltering further. This economy hurts those that live pay check to pay check. For those who have attained finacial independence, it's a small blip. I don't think the ubber rich even know the average American is hurting right now.

OMG, like Tom T., I'm in total agreement w/Georgie!

[George Schilling]

OMG, like Tom T., I'm in total agreement w/Georgie!

Tom I can understand, but you Bill? This proves that even a lefty is capable of rational thought on occasion.

[John Williams]

I'm doing better than I have the last couple of years. I do make alot of oil well related products so that's a big help. I just purchased my first new piece of equipment in ten years. I just hope it keeps going for some time. At least 5 years so I can pay for the new machine.

[George Schilling]

With the price of oil where it is, the smaller struggling oil companies who were able to weather the years of low prices should be able to open those marginal wells again. Should be good for some time to come John.

[Bob Beamesderfer]

There is not doubt about it, the spending power of the average American has been greatly reduced. People were using home equity to finance spending sprees. Now that's gone. And even people who have equity that might ordinarily tap into it, are leary. It has definately had an impact. Also, were it not for inflation, we would have been negative this quarter. People are spending the same but receiving less for their money. The dollar volume may not show it, but we are producing less and consuming less. Thankfully, the falling dollar has propped up exports which has certainly helped with the trade deficit and has kept the economy from faltering further. This economy hurts those that live pay check to pay check. For those who have attained finacial independence, it's a small blip. I don't think the ubber rich even know the average American is hurting right now.

Bingo! Now, if we had a manufacturing economy ...

[Steve Ekstrand]

Manufacturing is still very important to our economy even if it isn't the dominate characteristic.

[John Williams]

With the price of oil where it is, the smaller struggling oil companies who were able to weather the years of low prices should be able to open those marginal wells again. Should be good for some time to come John.

And they are. I've been getting calls from some small guys in texas and ok that I don't even know. Some of the little guys here in long beach and up notrh in Oxnard.

[Bob Beamesderfer]

With the price of oil where it is, the smaller struggling oil companies who were able to weather the years of low prices should be able to open those marginal wells again. Should be good for some time to come John.

And they are. I've been getting calls from some small guys in texas and ok that I don't even know. Some of the little guys here in long beach and up notrh in Oxnard.

Reportedly there's a shortage of oil field equipment. Good if you're John's shoes or own Schlumberger or Halliburton stock.

[Tom Tanquary]

Here's an interesting look at GDP.

interesting

HHGDP.jpg (28.51 KiB) Viewed 11920 times

[Larry Andrews]

http://www.time.com/time/nation/article ... ml?cnn=yes

On a more enjoyable note...

[Steve Ekstrand]

Good if you're John's shoes or own Schlumberger or Halliburton stock.

Don't forget National Oilwell Varco

[John Coffey]

Job prospects for college grads:

http://www.nytimes.com/2008/05/31/busin ... =permalink

[Larry Andrews]

http://www.reuters.com/article/ousiv/id ... 7020080530

On another more enjoyable note.

http://i35.photobucket.com/albums/d180/ ... mfront.jpg

[Tom Tanquary]

From the articles linked in the last two posts, I think you've found the recession.