US economy - a quintuplet of 'green shoots'

[Bushman]

In this time of maximum gloom about the global economy, it was an interesting excercise to climb my own mental 'wall of worry' and consider that it may well be the good old US of A that can lead the global economy out of the economic quagmire.

This article in the Economist certainly provides a thematic for a looming US recovery -

http://www.economist.com/node/21558576

The five-prongs of the recovery are:
1. US on the path to being a net energy exporter
2. Housing undervalued, household deleverage well progressed. Operation twist leading to record low mortgage rates
3. Innovation creating new industries
4. Banking system regulation
5. Exports to emerging consumer classes amongst the new economies

So, some three-years after Bernanke first saw the mirage of 'green shoots' amongst the scorched earth of the American economy, is this quintuplet of economic hope a platform for a sustained recovery? Could well be tinder dry, with the spark provided by the politcal impasse in Capital Hill being broken in the forthcoming election. Job creation is a lagging indicator

Would you like some 'boom' with your 'gloom' sir?

 

[Junior]

In this time of maximum gloom about the global economy, it was an interesting excercise to climb my own mental 'wall of worry' and consider that it may well be the good old US of A that can lead the global economy out of the economic quagmire.

This article in the Economist certainly provides a thematic for a looming US recovery -

http://www.economist.com/node/21558576

The five-prongs of the recovery are:
1. US on the path to being a net energy exporter
2. Housing undervalued, household deleverage well progressed. Operation twist leading to record low mortgage rates
3. Innovation creating new industries
4. Banking system regulation
5. Exports to emerging consumer classes amongst the new economies

So, some three-years after Bernanke first saw the mirage of 'green shoots' amongst the scorched earth of the American economy, is this quintuplet of economic hope a platform for a sustained recovery? Could well be tinder dry, with the spark provided by the politcal impasse in Capital Hill being broken in the forthcoming election. Job creation is a lagging indicator

Would you like some 'boom' with your 'gloom' sir?

Interesting article. The points above are big positives, particularly point 1 IMO. My concern is that they simply transferred a huge volume of debt out of private and into public hands, and are now in a position where they have a fiscal deficit which is seemingly impossible to close.

Private finances are in better shape, housing may have bottomed and becoming a net energy exporter are all extremely positive. The big issue is government spending, particularly welfare and defence. Spending here needs to be scaled back big time, and soon.

 

[Bushman]

Interesting article. The points above are big positives, particularly point 1 IMO. My concern is that they simply transferred a huge volume of debt out of private and into public hands, and are now in a position where they have a fiscal deficit which is seemingly impossible to close.

Private finances are in better shape, housing may have bottomed and becoming a net energy exporter are all extremely positive. The big issue is government spending, particularly welfare and defence. Spending here needs to be scaled back big time, and soon.

True, but being the world's reserve currency means they have more time on their hands. Its certainly not concerning bond investors, with treasury yields at record lows.

Another positive is an end to the GOP/Haliburton crusade in the Middle East.

When you contrast to the results austerity have brought to Europe, kicking the can down the road while you wait for the private sector/consumer to recover does not seem such a terrible idea.

 

[brty]

1. US on the path to being a net energy exporter

Don't know where you get this from in the article. What I read says.....

"Net imports of oil this year are on track to be the lowest since 1995, and America should eventually become a net exporter of gas."

That is vastly different from being a net exporter of energy. I would also be very wary of any article that uses the price of WTI as being what is paid for oil. Brent price is a far better indicator of what the world is actually paying for oil (including the US), WTI is the price paid for landlocked oil in Cushing OK. Even Louisiana Sweet is currently trading at a $17 premium to WTI.

The US currently is importing 7.547m bbls/day according to the EIA's latest figures for March 2012. This would be at a cost of about $800m/day or $292B/year. You would have to sell a lot of gas to equal that.

 

[Bushman]

Don't know where you get this from in the article. What I read says.....

"Net imports of oil this year are on track to be the lowest since 1995, and America should eventually become a net exporter of gas."

That is vastly different from being a net exporter of energy

My apologies ... net exporter of gas. Energy would obviously include oil, gas etc...

 

[Glen48]

That's good they can one day export Gas to Ireland, S Pain, Europe and all the other places in a depression, the USA housing is unknown as no one knows what the true facts are and how many are being held back before foreclosure.
I would be waiting to see if lawn mower comes along first.

 

[Bushman]

... and non farm payrolls, up 163k for July.

 

[young-gun]

... and non farm payrolls, up 163k for July.

22% of which were in a heavily subsidized health services industry. What happened to private sector and innovation creating jobs??

http://www.cnbc.com/id/48486006

 

[Bushman]

22% of which were in a heavily subsidized health services industry. What happened to private sector and innovation creating jobs??

http://www.cnbc.com/id/48486006

Otherwise known as fiscal stimulus? better than money printing ....

 

[noirua]

 

[divs4ever]

View attachment 155468

weak ??

looks more like 'self-mutilating ' to me

however on the positive side it has been saving Ukrainian lives , by being unable to ramp up the production of war machines and ordnance , providing excuses for Ukrainians to avoid walking into 'the meat-grinder' in as larger numbers as dreamed of ,

shame about the air quality in Germany though as impoverished families resorted to wood and coal for home heating needs

 

[Dona Ferentes]

weak ??

looks more like 'self-mutilating ' to me

however on the positive side it has been saving Ukrainian lives , by being unable to ramp up the production of war machines and ordnance , providing excuses for Ukrainians to avoid walking into 'the meat-grinder' in as larger numbers as dreamed of ,

shame about the air quality in Germany though as impoverished families resorted to wood and coal for home heating needs

Nice brainfart. No bearing on reality, though

 

[divs4ever]

Nice brainfart. No bearing on reality, though

time will tell ( and of course be revised by the victor )

 

[SirRumpole]

The gaming industry is bigger than some think.

US judge clears Microsoft's plan to buy Call of Duty maker Activision Blizzard

A British regulator also suggests it could reconsider its opposition to the deal, worth more than $100 billion.

www.abc.net.au