US Economy: Troubled or All's Well?
US economy experienced no growth since 2006/2007.
by Stephen Lendman
Headlines flashed warning signs. Commentaries downplayed them. A Wall Street Journal editorial headlined "As Contractions Go"."
US Q IV GDP shrank, "but not to worry. The report is better than it sounds, the stock market is rocking, and (the Fed will) keep both feet pressed firmly on the monetary accelerator."
The Financial Times headlined "US outlook still clear despite shower," saying:
Predicting recession "based on (-0.1% GDP decline) "is a bit like expecting rain because somebody threw a bucket of water out the window."
The wildcard is "if Congress decides to dump water out the window every month, via across-the-board 'sequester' cuts" expected soon.
According to Bloomberg , "R-Word For US Economy in 2013 is Rebound Not Recession."
According to JP Morgan Chase, Bank of America, and Morgan Stanley economists, America's economy "will bounce back in (Q I) after plunging defense spending and dwindling inventory growth" hurt Q IV.
Not according to economist John Williams . Recovery is illusory, he says. It's fake. Phony government numbers conceal weakness. Growth hasn't occurred since 2006/2007.
Earlier Williams said:
"Indeed, the "recovery' is an illusion that has been created as a direct result of methodological changes in government inflation reporting of recent decades."
They "resulted in an artificial lowering of official rates of inflation. The faux growth problem is in the use of understated inflation estimates in deflating a number of economic series."
"Major economic series that have no underlying pricing base - such as housing starts, payroll employment and consumer confidence - correspondingly do not require inflation adjustment to put them on a consistent theoretical basis with the concept of real (inflation-adjusted) GDP."
"Those series confirm a history of business activity in recent years that shows a plunge in the economy from 2006/2007 into late-2008/mid-2009, followed by a period of protracted, low-level stagnation, or bottom-bouncing, instead of 'recovery.' "