Soft and Flat? Danger-Slow Growth and Flattening Rates

Soft and flat? Danger!


Slow growth signs and flattening interest rates have economists and investors seeing trouble ahead.
April 27, 2005: 12:30 PM EDT
By Chris Isidore, CNN/Money senior writer


NEW YORK (CNN/Money) - Not too fast and not too steep would normally be a good path to follow. Unless, of course, you are hiking in today's land of economics. Then that path, to some, looks pretty scary.

First, the slow part ...

Worries about the strength of the economy abound. The latest troubling sign came Wednesday, when the March report on durable goods orders showed a 2.8 percent decline, the biggest one-month drop in more than two years. The February reading on orders for those big-ticket items also was revised to a decline of 0.2 percent rather than the perviously-reported gain of 0.5 percent.

"The soft spot is looking to be bigger and softer all the time," said economist Robert Brusca of FAO Economics following the report.

Next up is gross domestic product, the broad measure of the nation's economic activity. The Thursday morning report is now forecast to come in at an annual rate of increase of 3.5 percent in the first quarter, according to economists surveyed by Briefing.com. That's down from the 3.8 percent rise in the fourth quarter.

http://money.cnn.com/2005/04/27/news/economy/gdp_walkup/index.htm

Looks like they are starting to recognize that they have sucked all the blood out of the victim that they can, without killing it.

That news on MBNA's earnings was both very telling and very sweet. The credit card companies are gonna be in for a very rough patch.

The credit card companies are gonna be in for a very rough patch.

Once the bankruptcy bill takes effect, they can simply make up for any earnings shortfall by boosting interest rates (since the Repugs defeated an attempt to cap them at 30%) on the accounts they already have. Although some people will respond by paying off and cutting up their cards, there are millions upon millions of families (mainly from the "incredible shrinking middle class") who have no option but to keep carrying a large balance, and who therefore will be stuck with paying whatever rates the MBNAs of this world need to keep their bottom line comfortably in the black.

:-(

the deafault rate on my Sears card is over 29 percent. Uhhh if you are in default..... how are you going to pay that kind of interest?

That's the sort of thing that scares people away from buying a new washer and dryer (=durable goods)

charging a 30% or higher interest rate was a crime punishable by imprisonment.

Back then they called it loan-sharking!

Now they call it 'good business practice' with the blessing of our "bought and paid-for" Congress.


...My apologies. Carry on. I simply couldn't resist the rant.

Really stimulated the economy, haven't they?

The pukes always thought the economy was about the elite buying Jags, and lowering the tax rates on dividends.

It's not. The economy is about the middle class slob standing in a supermarket line. The person that drives a Civic, not a Jag. Ignore him, and your economy is going down the toilet, plain and simple.

That's why markets and economies tend to rise during a Democratic administration. Clinton understood this, the pukes never did. Or if they did, they didn't care.

not there to please them at the time.
Peace
Wildman
Al Gore is My President

for generational control.

by the time bushco is done -- it won't matter who is president -- there will be more power than ever in the hands of the corporate elite.

they will be the power behind the throne for a very long time to come.

Anyone who's unemployed or underemployed knows this economy's in deep sh*t & the rt-wing press isn't telling the truth about how bad it is.


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"Prosperity is just around the corner." — Herbert Hoover
"The economy has turned a corner." — GW Bush

Herbert Hoover = GW Bush

Neither man cared about the Depression their economic policies created.

...has done virtually nothing for business spending or the manufacturing sector which have been in a slump since the chimp arrived via his election coup.

The enormous and unprecedented amount of debt issued in the TRILLIONS since chimp took over has resulted in a pitiful whimper of economic activity. What we have witnessed is a debt financed expansion of consumer spending to cover the collapse of the production sector of the economy engineered by outsourcing corporations.

The pitiful level of so called "growth" since the bush debt economy came into being is the prelude to a huge financial crisis when the housing bubble bursts.

The chimp base of corporate rich simply don't care what happens to ordinary people as long as their coffers are full.