US Economy - Better GDP? Only deficit spending can hold up this bogus economy.
In the fourth quarter of 2009, the U.S. economy grew at its fastest clip - 5.7% - in the last six years. High fives all around? Not quite. On the surface, this report is great news. But the numbers also reflected a slowdown in inventory liquidations, which dropped $33.5 billion compared with the $139.2 billion decline in the third quarter of 2009. CNBC noted that the change in inventories contributed 3.39 percentage points to GDP, or "the biggest percentage contribution since the fourth quarter of 1987."
Paul Krugman, who has warned for months that the economic rebound is likely to fizzle without more fiscal stimulus, argues in his most recent New York Times piece that "the only thing that’s keeping the US from sliding into a second Great Depression is deficit spending."
Either way, the point is that the boost from the stimulus will start to fade out in around six months, yet we’re still facing years of mass unemployment. The latest projections from the Congressional Budget Office say that the average unemployment rate next year will be only slightly lower than the current, disastrous, 10 percent. Yet there is little sentiment in Congress for any major new job-creation efforts."
For more: Better GDP, Better Presidential Prospects? - Coop's Corner - CBS News
Paul Krugman, who has warned for months that the economic rebound is likely to fizzle without more fiscal stimulus, argues in his most recent New York Times piece that "the only thing that’s keeping the US from sliding into a second Great Depression is deficit spending."
Either way, the point is that the boost from the stimulus will start to fade out in around six months, yet we’re still facing years of mass unemployment. The latest projections from the Congressional Budget Office say that the average unemployment rate next year will be only slightly lower than the current, disastrous, 10 percent. Yet there is little sentiment in Congress for any major new job-creation efforts."
For more: Better GDP, Better Presidential Prospects? - Coop's Corner - CBS News
