To: puborectalis who wrote (647617 ) 3/11/2012 11:34:46 PM From: i-node 2 Recommendations Read Replies (2) | Respond to >> This is third month in a row that the economy has added at least 200,000 jobs.At this stage of the cycle, the economy is normally accelerating at a 5-plus percent pace. Not so now. It has slowed to a 2 percent rate . Usually we would be debating what kind of V-shaped recovery we are experiencing, and whether the rise of the upward diagonal threatens inflation. We do not have the elastic rebound that occurred in the early 1970s when a 3.2 percent decline from 1973 to 1975 (Nixon-Ford) was followed just four quarters later by a 6.2 percent bounceback. In the early 1980s (Reagan), we had a 2.7 percent peak-to-trough decline in gross domestic product, which was followed by a 7.7 percent recovery in the first four quarters of the expansion period. This time, the annual rate of GDP growth since the recession ended is 2.4 percent (with inventory growth making up one third of this cycle), despite a stimulus program that was unprecedented in size. This is the weakest recovery ever in terms of the growth rate in real final sales, employment . If this were a normal post-recession recovery, given the fiscal and monetary stimulus, GDP growth would be approaching 8 percent now.During the years surrounding the Great Depression, people could look around at the Golden Gate Bridge, the Hoover Dam, LaGuardia Airport, and so on, and see something for their money. Not this time. If anything, the failure of the president's $787 billion stimulus has discredited deficit spending altogether. As reported by David Rosenberg, chief economist slowest, weakest recovery from any recession in the last 60 years . When you strip out the stuff that is not discretionary spending, such as food and fuel, sales barely rose, increasing by less than 0.1 percent versus an average of 0.5 percent over the prior three months; it was the weakest showing since last May. People were cheered by the headlines touting the 200,000-plus increase in non-farm payrolls jobs What passed for job increases on a seasonally adjusted basis, however, was due to the less than normal winter layoffs, thanks to warmer weather that enabled people to keep working . We have managed to recoup a mere 3.3 million jobs from the 8.8 million lost in the recession that theoretically ended three years ago . In other words, this is an economy on major life support with zero economic momentum. No wonder voters see this as more than a recession. We will need a recovery from this recovery. We must change our public policy in a big way. As the old saying goes, "If your horse is dead, the best strategy is to dismount." . . . we must address the deficit along the lines of the Bowles-Simpson plan the president ignored, or at some unpredictable point we risk the bond market usnews.com
