Skip to comments.Something Strange: The Economy Is Behaving Badly In The Least Expected Way
Posted on 04/03/2012 7:18:54 PM PDT by blam
Something Strange: The Economy Is Behaving Badly In The Least Expected Way
April 3, 2012, 8:56 PM
Looking back over the latest few weeks of economy data, something stands out: Things are playing out almost 100% different than what people expected.
Think back to mid-to-late February. There were two competing trends. Housing appeared to be creaking back to life, construction was generally jumping, and car sales were surging month after month. Basically, all the "big" animal spirits stuff seemed to be happening.
But there was a counter-force in the form of gasoline prices. They were surging, and the big fear is that just as things were creaking back to life, gasoline prices would come in and slug the consumer.
As we pointed out, the fact that there was a duel between the big stuff (cars and houses on one side) and the day-to-day stuff (gasoline prices threatening the consumer) is what made the current environment very different form 2007-2008, the last time the economy went into recession.
We thought we'd be watching closely the high-frequency indicators, like same-store sales numbers and initial claims to get the first signs of problems, but that hasn't been how things have developed at all.
The weekly retail data has been great. Today's number was one of the best in a year. We had a few dicey weeks right when the gas surged, but everything's hunky dory on this front.
On the other hand, the big stuff has been not good.
Every single piece of recent housing data has been a miss.
And then today, it came out that the March auto sales numbers dipped sharply from February.
Also, construction numbers beyond housing have been poor.
So basically, the high-frequency consumer stuff has been fine, and the big money,
(Excerpt) Read more at businessinsider.com ...
Perhaps retail sales are up because everything costs 20 percent more.
I’d say that inflation is taking its toll! Of course those in charge keep contending that inflation is not happening but unfortunately, those in the real world are paying through the nose. Gas prices are the prominent culprit but other things are contributing.
The Obama administration and their lackeys continue to shout that the economy is doing just fine - as folks keep losing out due to inflation. Soldier on...
hey..no independent thought or logic allowed !
Retail sales are up because the cost of petrochemicals is up. This is pretty basic stuff.
Retail sales are up because the cost of petrochemicals is up. This is pretty basic stuff.
Communist economies always fail, but the muslim president of the US will come out of it as the new dictator of the former US.
>everything costs 20 percent more
or, more sneaky the box is 20% smaller for the same price:(
The big lie is that OPEC regulates supply and thus price.
At every turn Obama has played into their hands. Got to pay them back for the campaign donations.
Consumers are now conditioned to monitor the price of gas, (after all it is posted on every other street corner) to
to determine the state of the economy. Kind of like looking at the DOW to determine the state of the stock market.
IMHO Prices are skyrocketing. Go out and buy anything these days.
a regular jar of JIF peanut butter was $7.59 at Kroger today.
Wow, that is some expensive nuts!
expensive nuts is right Deagle - hell i’d be laughing but prices are killing us in flyover - they’re very clearly surging. I exclaimed in the aisle “holy sh-t”... and TWO old women replied to me in agreement.
This obama guy is out to ruin our nation.
Not laughing here... Every time I go grocery shopping I have a minor heart attack! Really it is getting bad - I’ve noticed that prices have risen 10% or more lately and since inflation is supposedly only 3% - what the heck!
Folks on a pension or limited income are suffering no doubt!. No problem though, our wonderful President keeps saying things are getting better...ha.
Ask 10 economists what the trend is and get 10 different answers.
The predictors are lousy because the government numbers being published are mostly lies. They claim unemployment is down because they adjusted the base line. The truth us more people are out of work than ever before. Credit is still tight. Another wave of foreclosures is coming. There is no turn around. You would never know it listening to O and his cronies
Jimah is smiling widely.
The auto companies pumped their supply lines full in Q4. That made it seem like lots of cars were being sold.
They are still on the lots.
You cannot push on a string.
I’ve taken to buying snack foods and sodas at Dollar General, still $1.25 for a two liter bottle name brand and $2.00 a regular sized bag for certain name brand snack foods. Food Lion has decent canned vegetables on sale 10 for $10.00. Combine it with rice, filling and cheap, enough to feed two people for less than three dollars.
I only buy what’s on sale and am not shy about changing my buying habits completely to stay within budget, but even still, it’s up 30% since two years ago, with less food and lower quality.
It gets to me every now and then and I’ll splurge on a decent steak dinner in an OK restaurant, that’s pushing $20.00 now, for what I still regard as a $12.00 meal.
New York state income tax revenues are also slowing down over the last six months (it's another one of the Big Five).
What's interesting is that in nearly all the states, sales tax revenue is UP, and not just a little bit.
I''m wondering if this is reflecting inflation, and people spending money they don't have because they're being told that "good times are here again".
The federales also say that inflation is low, because the federales adjusted the components to ignore the costs of energy and food. Or maybe it was energy and housing, whatever. But I have a question that's been on my mind- what is a good index to use to get an idea of the real decline in the value of the US dollar? Forget the gov't number on inflation, because of the afore-mentioned rejiggering. Gold has it's own life, and ups and downs. Maybe some commodity index? Anyone have any ideas?
I have certainly changed my own buying habits.
I think a lot of people have.
Your not alone... I do most of my shopping these days at Walmart and Dollar General. The problem is that many people do not have these choices. What do they do?
Almost all of these problems are caused by the government! Between the FED printing money and the Government spending like there is no tomorrow, well this is the result.
We are heading into Europland, Socialism, whatever you want to call it, but it is not good. The worst part is that the voters are too ignorant to recognize the path that is being taken or they want this - European Socialism.
Sometimes I think that people are just too stupid to govern themselves. Therefore, our Democratic Republic is doomed to fail. Seems that this is not a result that the founders thought was possible.
Texas has NO personal income tax (thank God) so this data must be incorrect in regards to Texas. Your larger point may still be valid however.
Very good! This is why it is also nonsense when some movie breaks box office records. Nobody accounts for inflation. Of course, the government loves this, because that is how they intend to deal with the debt - inflate it away. What do they care if they also destroy savings and the dollar?
But on the bright side of things, I always wanted to smoke a $100 cigar!
God bless the Lone Star State!
That old adage: “If you got it, then somewhere along the way to you, it was on a truck.”
We're paying the price for our folly right now. Most of the last decade has been an illusion, folks. You can start by taking all the defaults in mortgages and other debts, subtracting those numbers from the original transactions and recalculating our GDP figures. It won't be pretty. If someone bought a home for $500,000 for no money down, later defaulted on the loan when the value of the home declined to $400,000, and the home now sits in a state of limbo because the bank hasn't foreclosed on it, then we should stop pretending that the $500,000 sale ever really took place.
What size it that?
That’s a good point. The world economy is still based on huge amounts of leverage thanks to Alan and Ben’s ridiculous theories. They are justifiably afraid it will all unravel if they stop. There have been very small increases in sustainable economic ventures where people commit their capital for the long run (e.g. people investing their own money in their own businesses) But for the most part the recent economic growth is a speculative charade. For example investing in Apple with the result of more Chinese factories and oversupply is not sustainable.
Net weight varies, one of them in the kitchen cabinet says 12 oz., tortilla chips. Not family size, which is a lot taller, not individual, which is a lot smaller. You know, regular size,
“Perhaps retail sales are up because everything costs 20 percent more.”
That is certainly why the stock market is up (on some days); devalued dollars.
“Folks on a pension or limited income are suffering no doubt!”
They should be; they were the prime target of the devaluation of the dollar. The social security costs will be reduced by reducing the payments in real terms, while inflation is understated (or its existence outright denied) so the cost-of-living adjustments don’t make up for the inflation.
Anyone receiving SS in 2007 should be receiving checks for twice as much now (but they aren’t); apparently Obama wants old people to die.
I don’t even think Dollar General is a bargain; they have low prices for smaller quantities/packages.
Wal-Mart is a good deal; that is why it is becoming the “company store” to our “coal mine” economy. We are paid in mine company scrip, but it can only be spent in the company store (the only place it holds any value).
We’ve been reduced to Red Chinese peasants...
2. The military campaigns in Iraq and Afghanistan were largely financed through "off-budget" appropriations, and even at that the true cost of those wars has never been told to the American public. The U.S. government stopped publishing M3 money supply measure around 2006. The first big spike in energy prices and the collapse of the U.S. economy occurred not long after that. Do you think that was a coincidence? What do you think that was all about?
3. I've got three words for you: Medicare prescription drugs. There's no hiding the fact that this massive new Federal entitlement was driven entirely by the Bush administration and the Republican Congress. And the biggest costs of that entitlement don't even show up until long after Bush left office.
True, Texas has no personal income tax. But they DO collect the Federal income tax for the Feds (don't ask me why - probably helps their revenue stream somehow):
It's in the SECOND table (Revenue by Source). They're down -15.27% Year-To-Date in Federal Income Tax collection over last fiscal year.
My larger point is still valid.
Looks like you had figured out what would eventually happen further down thread.
Hey, the movie industry exploded during the depression. Everybody had a nickel...
Also, credit drove the big stuff. If there was no such thing as credit, how many motorcycles, snowmobiles, boats and motorhomes (not to mention “expensive” cars) would be sold?
If people can’t get credit, and there is no money in saving, they just blow their money on little stuff. I suppose restaurants are booming. I’ll have to check.
Hamburger over $3 a pound? No inflation? HAHAHAHAHAHA!
It’s all about hedonics. Watch and learn:
Well done. Thanks for saving me the effort!
I paid $4.38 a pound for lean ground hamburger Monday night at Wal-Mart. The same a couple years ago was $2.78.
Republican Candidates could improve their Primary vote count by campaigning with the following idea:
Due to the FHA, Fannie and Freddie Bankruptcies of September, 2008, American home owners lost 30 % of the value of their homes. That is a 30 % cut in just one month. Home values are still down 30 %.
Thus, let us cut the total compensation to all elected Federal politicians, and their staffs by 30 %, and an additional 10 % cut to elected Federal politicians each year until Federal Spending is LESS THAN the average of the previous 2 years of Federal income.
BTW, since slightly less than half of the US House, and 2/3 of the US Senate are Millionaires, it will be a great opportunity for Congress to lead by example that EVERYONE should give up their fair share of the American Dream.
What better way can there be to demonstrate that Federal politicians are on the same page as the voters?
That's Texas's revenue from the federal government. Federal aid, in other words.
Thanks! That was unclear to me.
When I was a kid, regular size was 16 oz for a bag of chips. Now they’re down to 10.
I notice recently event he facial tissues are smaller. My wife get Puffs. The sheets are about 1/2” or more shorter on each side.
Actually, I think you are right on! I do believe that the Federal Government is looking for ways to reduce costs for retirement. Expansion of the dollar and inflation is the easiest way it seems.
The inflation helps the government as long as it isn’t factored into those payments; it is supposed to be, but by constantly understating inflation the gov’t. is short-changing all of those people.