Economic Recovery Update
Here are some good-news stories about the economy you might have missed, since the major media still seem to be ignoring or downplaying most good economic news the same way they ignore most good news from Iraq:
Low inflation to boost housing in 2004 - Inman News
Despite an expected acceleration in economic growth, low inflation should maintain a low level of mortgage interest rates and keep housing near historic highs in 2004, according to the National Association of Realtors.
David Lereah, NAR's chief economist, said a growing economy normally places pressure on interest rates. "Many industries including the hard-hit manufacturing sector are now facing increased demand, and we can expect strong economic growth into next year," Lereah said. "With no inflation in sight, we don't expect the Federal Reserve to move on interest rates until the third quarter of 2004."
He projects growth in the U.S. gross domestic product to rise to an annual growth rate of 5.6 percent in the current quarter, with GDP for all 2003 increasing 2.8 percent before growing another 4 percent next year. Consumer price inflation should be 2.4 percent for this year and only 1.6 percent in 2004.
McTeer: Economy shows good signs - CNN/Money:
Federal Reserve Bank of Dallas President Robert McTeer said Tuesday there have been enough indications in the economy to make him feel confident about a gradual recovery. Even though the economy struggled to recover fully from the 2001 recession, it grew at a healthy pace in recent quarters, McTeer told CNNfn's The FlipSide.
While high unemployment numbers remained on most people's minds, gross domestic product (GDP) has been showing good signs. The second-quarter GDP grew at a revised 3.3 percent annual rate, up from a 3.1 percent rate reported a month ago. "This quarter we just finished is going to be even better," McTeer added. "My guess is going to be over 5-percent growth" he added.
Survey: CEO confidence in economy increases - Sacramento Business Journal:
Chief executive officers of small to mid-size companies are showing more confidence in the nation's economy, according to a quarterly survey of 1,000 CEOs by San Diego-based TEC International, a nonprofit organization for executives. Overall confidence in the economy rose by 8.7 percent when compared to the second quarter results released June 9.
"More firms reported that the acceleration in economic growth was already under way, and this improvement was used to justify more aggressive expansion plans," says Richard Curtin, a consultant to TEC on its surveys and director of surveys of consumers for the University of Michigan. "More than eight in ten firms expect revenue growth during the year ahead and seven in 10 predict higher profit margins."
Among all CEOs surveyed, 51 percent reported they had already noticed renewed strength in the overall economy, up sharply from the 30 percent recorded in the second quarter survey.
Survey: If optimism holds, companies will spend- Atlanta Business Chronicle
Owners of small and midsized businesses like their prospects, a new survey shows. Nearly 80 percent say they are optimistic about their firm's chances for growth in the next 12 months, and 32 percent plan to increase spending in coming months, a poll for The Network of City Business Journals has found.
The purchasing dynamics survey of 901 decision-makers at businesses with between one and 499 employees found owners of small and midsized businesses ready to spend on equipment and services at levels not seen since the late 1990s. And the percentage of business owners citing the economy as a business concern dropped from 67 percent in 2002 to 58 percent this year.
Poll results could be a sign of a reviving economy, though economists remain cautious about the employment picture. Economists say it's no surprise that small businesses might be more optimistic than larger firms, since they are able to respond to market conditions more quickly.
"They're smaller and nimbler," John Lonski, chief economist at Moody's Investor Service, said of small businesses. "They might be expected to lead the rest of the economy in an economic recovery."
The poll, performed between May and August by Kadence Business Research of Framingham, Mass., shows 78 percent of business owners are optimistic about their prospects. Only 4 percent believe their prospects will worsen, while 18 percent expect them to stay the same.
Mankiw sees faster economic growth - Washington Times via UPI.
The chairman of the White House's Council of Economic Advisors says he expects the nation's gross domestic product to exceed 4 percent in the third quarter.
I blame the Bush tax cuts! |
