The incredible rush of third-quarter growth has proven to be bigger than expected as GDP growth estimates have been adjusted upwards to an incredible 8.2%. This is certainly good news and shows that the unprecedented economic growth in the third quarter was stronger than expected.
Even more importantly, consumer confidence has also increased significantly in the month of November. As one analyst put it:
“The improvement in the present situation Index, especially in the jobs component, suggests that consumers believe a slow but sure labor market turnaround is underway,” said Lynn Franco, director of the Conference Board’s Consumer Research Center. “The rise in expectations is a signal that consumers will end this year much more upbeat than when the year began.”
Confidence is watched closely by policy-makers and analysts since consumer spending fuels more than two-thirds of the nation’s economy.
A high rate of GDP growth coupled with an increase in consumer spending is a major indicator of lasting economic recovery. Third quarter saw an increase of 6.4%, a significant boost. Even more critical, durable goods purchases increased by a very strong 26.5% as well, a much-needed boost to the manufacturing sector which been badly battered by the global economic slowdown.
It appears as though the US economy is on the road to recovery as almost all major indicators show significant positive growth. This growth is fueling a slow but steady increase in the critical labor market. As the economy continues to pick up job growth will increase as the lagging indicator of jobs matches leading indicators like GDP growth and consumer confidence.
It’s more good news for American consumers and businesses, and bad news for the Democrats who had been hoping to capitalize on the economy in 2004. It’s looking increasingly like the “Bush economy” will be a compliment rather than an epithet as the campaign season gets underway.
Another low volume thread… I detect a pattern.
Well, Stan, many of us Liberal-type thinkers lean towards Keynesian policies, and deficit spending improves the economy in the short run. Meanwhile, we’ve got a net job loss of over 2 million and a rising debt to deal with. Good news on the economy is welcome, but I think you should be holding out for more before gloating.
But gloat if you want: we seem to be getting good news out of Bush’s fiscal policy. After over two years of crappy performance, it’s about time.
After over two years of crappy performance, it’s about time.
Ofcourse, you’ld have to make the case to attribute the “two years of crappy performance” to him.
“Ofcourse, you’ld have to make the case to attribute the “two years of crappy performance” to him.”
Not really. All I need to do (from a spinmeister point of view) is remind voters that when Clinton was in office, the economy was booming and jobs were created left and right (like the turn of rhetoric–that “left and right” bit?). THEN I just point to the deficit, and say “this is proof that Keynes was right about massive public spending improving the economy.” If that doesn’t hold, I point out the increasingly shrinking middle class as a sign that the tax cuts are increasing GDP but not actually helping the middle and working class families in the US.
I don’t have to attribute a single aspect of the “two years of crappy performance” to Bush if I don’t want to. I’m a pragmatist, and spin is the language of the realm. Spinning down the uptick is easier than defining the recession, and works better in soundbyte form. Think along the lines of “it was World War II and the massive public spending that came with it that ended the Great Depression, and it was the war in Iraq and the enormous deficit Bush has created that ended the last recession.” Now I’ve denied credit to Bush, while mentioning that the economy might still be getting better now. Meanwhile, I throw in a line about “Clinton-era prosperity” and all of a sudden we’re in commercial and a blind baton-twirler is our guest after the break to tell her amazing story.
God help us all when the steel tariff situation comes back full force into the picture.
Welcome to the TV Nation. Everything I just mentioned can be done in less than two minutes of pundit-time. Educated and informed people can read the Economist and see for themselves what the situation is.
http://www.economist.co.uk/World/na/displayStory.cfm?story_id=2213835
(“I’m so smart! I read the Economist!” -The Onion)
Not really. All I need to do (from a spinmeister point of view) is remind voters that when Clinton was in office, the economy was booming and jobs were created left and right
Right. And by that logic… When Clinton was in the office, I was several years younger. Now that Bush is in the office – I am older. I guess Bush caused me to age 🙁
Also, remind voters that republiacns eat babies, will repeal emancipation proclamation, etc. Works better in soundbyte form. You can have the dumb vote.