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Strategies & Market Trends : Zeev's Turnips - No Politics -- Ignore unavailable to you. Want to Upgrade?

To: LTK007 who wrote (7537)	11/23/2001 8:50:23 AM
From: Softechie	Read Replies (1) \| Respond to of 99280

GDP from Briefing.com: Highlights Q3 GDP -0.4%, Final Sales unchanged. 2.1% GDP deflator, 0.3% core PCE deflator Key Factors First quarterly GDP decline since Q1 1993. Q4 contraction expected to be worse. Weak 1.2% PCE growth. 1.7% durable goods purchases topped the growth in nondurables and services. The plunge in business investment slowed but remains strong. Equipment led the improvement. Residential investment showed a third quarter to growth, outlook worsens for Q4. Massive global trade contraction helped the bottom line as import dollar decline offset 17% plunge in exports. Inventories provided a drag given Sep assumption. Flat final sales are GDP-inventories. Government spending rose just 1.8% after 5.1% annualized pace in the first half. Chain-weight deflator growth same as 2.1% in Q2. -0.4% PCE price contraction aided by lower net insurance premiums. Big Picture The boom through mid 2000 gave way to the current bust (recession). The corporate profit recession left businesses cutting costs and the manufacturing sector in severe contraction. The downturn has spread to the consumer given massive equity losses, accelerating layoffs, sharply reduced global trade and the 9/11 which added to the decline in consumer confidence. In sum, the economy is in recession and the global economy is following along. The speed and strength of the eventual upturn is as unclear as the duration and severity of the recession. Risk of further terror adds to consumer uncertainty. Fiscal and monetary policy are extremely stimulative and will resuscitate the economy over time. Inflation concerns have disappeared given the plunge in commodity prices and the economic recession.