• This is a political forum that is non-biased/non-partisan and treats every person's position on topics equally. This debate forum is not aligned to any political party. In today's politics, many ideas are split between and even within all the political parties. Often we find ourselves agreeing on one platform but some topics break our mold. We are here to discuss them in a civil political debate. If this is your first visit to our political forums, be sure to check out the RULES. Registering for debate politics is necessary before posting. Register today to participate - it's free!

GDP Contracted at 1% Pace in First Quarter

U.S. GDP Contracted at 1% Pace in First Quarter - WSJ.com

"he U.S. economy contracted in the first quarter of 2014, the latest stumble for a recovery that has struggled to find its footing since the recession ended almost five years ago."

The "recovery" is over.

Actually, the drop in GDP was probably due to the weather. I know you don't want to hear this, but I am quoting from that Hippy-Commie rag known as the Wall Street Journal. You can read about it here. The next report is due out in another 3 months, and we will have a better gauge on things then.

NOTE: Maybe Obama DOES have the power to wreck our economy by changing the weather, so maybe it is still all his fault. LOL.
 
Yes, going on 6 years and its still the last guys fault....

Lol !

Those tax cuts, which brought us to the lowest income taxes since before WW2, really sent our economy into overdrive, didn't they?

And yeah, when the last guy's policies are continuing for another six years, I would say they can have an effect six years later.
 
At the same time labor participation is at multi-decade lows....
...a trend that started in 2001. By the way, wages went flat in the early 1970s -- so the complaints about "low-paying jobs" could be leveled at any President who presided any time in the past 40 years.


Never mind that any "growth" in the economy is fueled entirely by various Fed and government injections that are unsustainable and distort the market.
The market isn't going through the roof because of Fed policies. It's because corporate profits are through the roof, mostly as a result of squeezing employees as hard as they can during bad economic times.

MW-BA841_profit_ME_20130328093338.jpg



Companies are also holding record amounts of cash. Is that also a "negative indicator?" U.S. Firms Hold Record $1.64 Trillion in Cash With Apple in Lead - Bloomberg


Stocks jumping higher on such horrible news is a pretty good indicator of how rigged the market has become.....
"Rigged" by whom? Did the Fed make a big loan this morning, so that someone could single-handedly invest enough to boost the market?

Or, perhaps the market shrugged off the news, because in their view it wasn't a big deal.


All meaningful indicators point to a recession starting this year....
Which "meaningful indicators" are you talking about? The Conference Board's LEI has been rising for 3 months in a row. Pretty much everyone understands that Q1 got hammered by an awful winter, and it is likely to have produced some pent-up demand.


unlike Clinton, Obama will not be able to bail out the system and paper over the losses so that it gets pushed into the next guy's term.
What fantasy is this? Or perhaps you are referring to George Bush 41, who threw immense sums at the S&L Crisis, which left Clinton with a nice chunk of fancy new debt? Heck, the S&L Crisis cost the taxpayers far more than anything Bush 43 or Obama did to get over the financial crisis.


The U.S. is still in bailout economy conditions and it would take the kind of money injection that usually precedes hyperinflationary sovereign default crises to prevent another serious downturn.
Yes and no.

"Yes" in that we are still in a bit of a liquidity trap, which means the Fed can continue actions like QE without causing inflation any time soon -- in the same way that they have done so for many years now, without producing the "hyperinflation" expected by people who don't understand economics well.

"No" in that the Fed can't really do much more at this point if the economy takes a serious downturn. Inducing "hyperinflation" is obviously something no US central bank will do, at least not during our lifetimes. We are also a long, long way from any sort of default because of anything other than legislative dysfunction.
 
They have to say that. Its the Federal Reserve. Gotta keep up the illusion of recovery at all costs. People really do drink the kool-aid. The one redeeming sector for GDP was healthcare.

Really? Healthcare? But the GOP told us that Obamacare was supposed to destroy that sector right before destroying our economy altogether... hrrmmmmm
 
Whatever the reason, its quite possible we're in the middle of small recession, but wont know for a few months. I bet politicians are very scared right now, given the proximity to the election.

My personal prediction is that it will rebound really quickly but we are headed for another wall street/banking crash in about a year or two. We've done nothing to the "too big to fail" sector after we bailed them out in 2007/2008 and now they are much bigger than they were then. Then there are the investments based on rampant speculation rather than company forecasts and production which is inflating stock. Not to mention the stupid practice of computer investments that buy and sell fractional shares in nanoseconds based on mathematical algorithms and not company forecasts and production. All this is creating extremely false worth and instability in the markets.
 
Last edited:
reagan blamed everything on carter.


Lol !

Reagan was actually qualified and he DID inherit a mess.

But Reagan's not relevant to your irrelevant Bush blame.
 
Bad news for America... and the GOP rejoices.

We tried to warn you people back in 2008 when Millions of Americans were equating empty plattitudes to Presidential qualifications.

People like you supported this guy and his progressive policies. Voted for him and gave him the power to sign destructive legislation.

So why are the Conns the bad guys ?
 
Lol !

Reagan was actually qualified and he DID inherit a mess.

But Reagan's not relevant to your irrelevant Bush blame.

Obama inherited a mess. What reagan inherited is pale in comparison to GBR.
 
We tried to warn you people back in 2008 when Millions of Americans were equating empty plattitudes to Presidential qualifications.

People like you supported this guy and his progressive policies. Voted for him and gave him the power to sign destructive legislation.

So why are the Conns the bad guys ?
He hasn't done anything. The do nothing republican congress won't let him. They are content on continuing the GBR.
 
My personal prediction is that it will rebound really quickly but we are headed for another wall street/banking crash in about a year or two. We've done nothing to the "too big to fail" sector after we bailed them out in 2007/2008 and now they are much bigger than they were then. Then there are the investments based on rampant speculation rather than company forecasts and production which is inflating stock. Not to mention the stupid practice of computer investments that buy and sell fractional shares in nanoseconds based on mathematical algorithms and not company forecasts and production. All this is creating extremely false worth and instability in the markets.

Everyone in Washington has known they need to knock down some of these too big to fail companies a notch or two. But I suppose those too big to fail companies continue to donate much needed campaign cash to those in Washington just so they won't.
 
Yes, going on 6 years and its still the last guys fault....

Lol !

It sort of is Bush's fault and Clinton's and Greenspan's and all the various private lenders who played along. Never mind the various Senators and Representatives who had their roles. This was a bipartisan f**kup.

...a trend that started in 2001. By the way, wages went flat in the early 1970s -- so the complaints about "low-paying jobs" could be leveled at any President who presided any time in the past 40 years.

Are you suggesting these things were not made markedly worse over the past few years?

The market isn't going through the roof because of Fed policies. It's because corporate profits are through the roof, mostly as a result of squeezing employees as hard as they can during bad economic times.

More like by pumping up stock prices, which are being artificially inflated by widespread buybacks, high-frequency trading, and trillions of dollars in Fed cash. Look at your graph real closely, and then consider why that graph may not be saying a good thing about the economy.

Companies are also holding record amounts of cash. Is that also a "negative indicator?" U.S. Firms Hold Record $1.64 Trillion in Cash With Apple in Lead - Bloomberg

Yes, actually. It suggests they aren't spending money because they either have nothing to spend it on or are hoarding cash out of concern that they may need it soon.

"Rigged" by whom?

See above.

Which "meaningful indicators" are you talking about? The Conference Board's LEI has been rising for 3 months in a row. Pretty much everyone understands that Q1 got hammered by an awful winter, and it is likely to have produced some pent-up demand.

Actually, pretty much everyone agrees there were other reasons for bad indicators and that weather does not come close to explaining it all. The pent-up demand is probably true, which is why some of the indicators look better right now.

What fantasy is this?

Oh come, come, the bailouts of big money institutions and moral hazard was Long-Term Capital Management and the housing bubble started getting blown up in the late 90's to cover for the dotcom bubble.

"Yes" in that we are still in a bit of a liquidity trap, which means the Fed can continue actions like QE without causing inflation any time soon -- in the same way that they have done so for many years now, without producing the "hyperinflation" expected by people who don't understand economics well.

"No" in that the Fed can't really do much more at this point if the economy takes a serious downturn. Inducing "hyperinflation" is obviously something no US central bank will do, at least not during our lifetimes. We are also a long, long way from any sort of default because of anything other than legislative dysfunction.

Hyperinflation is not something a central bank aims to achieve. It is a function of mismanagement. The Fed is not stupid enough to get the U.S. into that sort of mess, in my opinion, which is why I do not think they will do much about another downturn. All they could do in the event of another serious downturn is print money like crazy, which could easily lead to hyperinflation and hyperinflation means default.
 
Exactly:



Source: Forbes

That people buy this crap is what really makes for a laugh. Absent the Obamacare surge in healthcare spending this would have been a 2% contraction. It may still be revised lower as is wont to happen.

You are actually going to claim Obamacare pumped 1 % of GDP into the economy? Care to document that?
 
Actually, pretty much everyone agrees there were other reasons for bad indicators and that weather does not come close to explaining it all. The pent-up demand is probably true, which is why some of the indicators look better right now.

Who is this everyone? You and?
 
The "recovery" is over.

Or hasn't started yet or may never start. The numbers used to declare recessions and recoveries apparently don't indicate anything about economic health because we haven't any of that since late 2007. The economy has been poor since then regardless of the numbers people use to measure it. Perhaps there needs to be a new measure that is more meaningful.
 
Bad news for America... and the GOP rejoices.

Who is rejoicing? Your argument is like saying that Democrats rejoiced at every dead soldier in Iraq.
 
Last edited:
That was four million less than in 2008 and the more people see of him the more they realize the mistake they made. Why would anyone support the transformation of this economy into a European socialist one?

Because they are bribed with wealth redistribution.
 
Really? Healthcare? But the GOP told us that Obamacare was supposed to destroy that sector right before destroying our economy altogether... hrrmmmmm

Perhaps its delayed given how a lot of the bill was initially delayed, and Obama has been delaying some of the worst provisions since then. When does Obamacare even take effect?
 
Obama inherited a mess. What reagan inherited is pale in comparison to GBR.


Not true, Reagan inherited double digit interest rates, poverty rates were at a all time high, and Unemployment rates were higher and you're STILL 6 years in blaming Bush.

Its getting childish.
 
Are you suggesting these things were not made markedly worse over the past few years?
I'm saying that the shrinking of the labor force is a trend that started 8 years before Obama took office. I would also say that neither Bush 43's nor Obama's policies are causal factors.


More like by pumping up stock prices, which are being artificially inflated by widespread buybacks, high-frequency trading, and trillions of dollars in Fed cash. Look at your graph real closely, and then consider why that graph may not be saying a good thing about the economy.
1) Buybacks aren't "artificial" inflations, they're a standard practice -- and don't explain multi-year broad-based rises in prices. Plus, if shares are bought back with credit, that will show up on the company's ledger.

2) Policies like QE have nothing to do with high-frequency trading; even without QE, that was going to happen. Perhaps we can say that the Obama administration hasn't tried to rein in HFT, but then we're back to issues of an obstructionist Congress.

3) Again, it's not clear how actions like QE would really prop up a stock market. Nor would that seem necessary, since (again) the corporations are reporting huge profits and sitting on big cash hoards.

4) Stock prices are only one part of the LEI.


It suggests they aren't spending money because they either have nothing to spend it on or are hoarding cash out of concern that they may need it soon.
Actually, it suggests that the companies aren't interested in accumulating debt (a practice that contradicts your implication that Fed lending policies are encouraging stock buybacks). There's plenty they could spend it on, such as improving wages or making capital improvements. Regardless of the rationale, it makes the company's bottom line look better, and is a reason for high stock prices, unrelated to Fed actions.


Actually, pretty much everyone agrees there were other reasons for bad indicators and that weather does not come close to explaining it all. The pent-up demand is probably true, which is why some of the indicators look better right now.
The bad weather doesn't explain it all, but it's a big chunk. More to the point is that one quarter with a -1% GDP growth is not an indicator that the entire economy is going to hell in a handbasket (as the OP implies). Nor have you actually articulated which indicators are currently negative.


Oh come, come, the bailouts of big money institutions and moral hazard was Long-Term Capital Management and the housing bubble started getting blown up in the late 90's to cover for the dotcom bubble.
1) LTCM's bailout was engineered by the New York Fed, not Washington. And it didn't cost the taxpayers a cent.

2) I do agree that the seeds of the housing bubble do extend to the Clinton years, namely a reluctance to regulate derivatives. However, blaming any President for the housing bubble is incorrect. Aside from a lot of non-governmental factors, the same lax policies were pursued by Clinton and Bush and Greenspan, and aided by players from both sides of the aisle.

3) It is slightly ridiculous to suggest that anyone intentionally started a housing bubble to cover for a stock market crash. You're looking at nearly 8 years of Fed policies of keeping interest rates low, with wide-spread resistance to the Fed raising any rates. Plus, again, many other factors had nothing to do with any government policies.

In terms of "moral hazards," it's worth noting that before the modern Fed was created, the banks often bailed each other out in similar crisis. Oddly enough, no one seemed to fear the moral hazard when private banks were taking on the role of the "lender of last resort." Hmmm. ;)


Hyperinflation is not something a central bank aims to achieve. It is a function of mismanagement. The Fed is not stupid enough to get the U.S. into that sort of mess, in my opinion, which is why I do not think they will do much about another downturn. All they could do in the event of another serious downturn is print money like crazy, which could easily lead to hyperinflation and hyperinflation means default.
That's pretty much what I'm saying. The Fed doesn't have any more tools to deal with another downturn, though it could step in again to deal with failing banks.

But that still leaves the question: Which "meaningful indicators" suggest we are heading for another recession this year, as you claim?
 
It sort of is Bush's fault and Clinton's and Greenspan's and all the various private lenders who played along. Never mind the various Senators and Representatives who had their roles. This was a bipartisan f**kup.



Are you suggesting these things were not made markedly worse over the past few years?



More like by pumping up stock prices, which are being artificially inflated by widespread buybacks, high-frequency trading, and trillions of dollars in Fed cash. Look at your graph real closely, and then consider why that graph may not be saying a good thing about the economy.



Yes, actually. It suggests they aren't spending money because they either have nothing to spend it on or are hoarding cash out of concern that they may need it soon.



See above.



Actually, pretty much everyone agrees there were other reasons for bad indicators and that weather does not come close to explaining it all. The pent-up demand is probably true, which is why some of the indicators look better right now.



Oh come, come, the bailouts of big money institutions and moral hazard was Long-Term Capital Management and the housing bubble started getting blown up in the late 90's to cover for the dotcom bubble.



Hyperinflation is not something a central bank aims to achieve. It is a function of mismanagement. The Fed is not stupid enough to get the U.S. into that sort of mess, in my opinion, which is why I do not think they will do much about another downturn. All they could do in the event of another serious downturn is print money like crazy, which could easily lead to hyperinflation and hyperinflation means default.


It was actually more of the Democrats fault.

Clinton used the manufactured false narrative of "discriminatory lending practices" to force lenders to lower their standards.

He then co-opted the GSEs into purchasing massive amounts of Sub-Prime loans and securities and then appointed his buddies to their executive and chair positions.

Fannie and Freddie then were ran like ENRON on steroids as they committed unprecedented Securities fraud, lied about their profits and hid Billions.

They were the only two Financial entities subject to SEC investigations over their unprecedented corruption during the Sub-Prime build up.

And they were defended by Democrats until they were declared insolvent in 2008.

Housing under Clinton went from 63 percent in 1993 to 68 percent in 2000.

Under Bush it only went up another 1 percent.

Regardless, the effects of the Sub-Prime Bubble are not a legitimate excuse 6 years in for our continued economic issues.
 
Last edited:
Really? Healthcare? But the GOP told us that Obamacare was supposed to destroy that sector right before destroying our economy altogether... hrrmmmmm

I wouldn't call that a positive boost for the economy. People spending money on insurance premiums doesn't create much value.
 
I wouldn't call that a positive boost for the economy. People spending money on insurance premiums doesn't create much value.

Yea, in fact it means they have less money to spend on additional goods and services.

Liberalism's concept of " equality " is all about removing more and more of the Middle Class's discretionary income.

And then WE get the blame when their policies cause a contraction in our GDP.

Well they blame us and the " Weather ".

Yea, the largest economy in the world can't fend off a Little Bad weather without it causing our GDP to shrink.

Lol !
 
Back
Top Bottom