The title of a Bloomberg article released on January 30, 2013 is “Growth Stall OBSCURES U.S. Consumer, Business Gains: Economy” (Web-site/URL: http://www.bloomberg.com/news/2013-01-30/economy-in-u-s-unexpectedly-shrinks-as-defense-spending-plunges.html).
According to Paul Edelstein, director of financial economics at IHS Global Insight in Lexington, Massachusetts, whose team projected a 0.3 percent gain, the LOWEST in the Bloomberg survey”, “I’m NOT going to say growth is particularly strong, but this IS NOT a recessionary signal BY ANY MEANS. This really was a story about A PAYBACK in national defense spending (CUTS). Consumer- spending growth PICKED UP (and) fixed investment was fairly strong”.
“Stocks FELL, DRAGGING benchmark indexes from five-year highs. The Standard & Poor’s 500 Index declined 0.4 percent to 1,501.96 at the close in New York”.
“in a (research) note (to clients)”, economists David Greenlaw and Ted Wieseman at Morgan Stanley in New York, said: “The “STATISTICAL NOISE in the defense and inventory components” means it’s best to look at the average pace of growth over the second half of the year to get a better understanding, The resulting 1.5 percent “is RIGHT IN LINE WITH the growth pace seen in recent years”, “right in line with” EXPECTATIONS (Web-site/URL: http://www.youtube.com/watch?v=NgnAY_eXYbI).
:”A statement from Fed policy makers today (January 30, 2013) indicated the central bank will continue its unprecedented balance-sheet growth to spur the economic expansion and reduce unemployment. The Federal Open Market Committee (FOMC) said it will keep purchasing securities at the rate of $85 billion a month”.
“The Fed repeated that the purchases will continue “if the outlook for the labor market DOES NOT improve SUBSTANTIALLY (?)” HOW MUCH is “substantially?” Again, this is open to INTERPRETATIONS (Web-site/URL: http://www.youtube.com/watch?v=NgnAY_eXYbI).
“the FOMC also said”. “Although strains in global financial markets have eased somewhat, the committee CONTINUES TO SEE DOWNSIDE RISKS to the economic outlook” obviously. These are variables.
“The GDP report also showed price pressures remain contained, giving policy makers reason to stay the course. A measure of inflation which is tied to consumer spending and tracked by Fed officials,CLIMBED at a 1.2 percent annual pace compared with 1.6 percent in the prior quarter (October-December, 2012)”. So prices are increasing but NOT as quickly, which is good news for HOUSEWIVES who are only concerned about CHEAP vs. EXPENSIVE.
“General Electric’s fourth-quarter profit TOPPED analysts’ estimates as demand in emerging markets fueled the aviation and healthcare divisions, which helped build a record $210 billion order backlog for the Fairfield, Connecticut-based company”. “on a Jan. 18 (2013) conference call”, CEO Jeffrey Immelt said: “We saw REAL STRENGTH in the EMERGING markets and the developed regions stabilized“. Of course, this is exactly what CHINA wants to hear because the Chinese are always looking for EGO BOOSTERS. GE “entered 2013 with SUBSTANTIAL momentum” following “SOLID order growth in five of the six businesses”, which of course is good but again, the question is: can this “solid order growth” BE MAINTAINED?
The conclusion of this article, again, is easy. Notice “economic growth”. This is what THE US needs, NOT CHINA (which insists that they MUST grow at an annual rate of 8% or else, they have problems).