Saturday, January 9, 2010
How To Make A Watercolour Paper Stretcher
News: When handling the U.S. GDP n'amusent anyone.
/ * Style Definitions * / table.MsoNormalTable {mso-style-name: "Table Normal"; mso-tstyle-rowband-size: 0 ; mso-tstyle-colband-size: 0; mso-style-noshow: yes; mso-style-priority: 99; mso-style-qformat: yes; mso-style-parent: ""; mso-padding-alt: 0cm 5.4pt 0cm 5.4pt; mso-para-margin-top: 0in; mso-para-margin-right: 0in; mso-para-margin-bottom: 10.0pt; mso-para-margin-left: 0in; line- height: 115%; mso-pagination: widow-orphan; font-size: 11.0pt; font-family: "Calibri", "sans-serif"; mso-ascii-font-family: Calibri; mso-ascii-theme-font: minor-latin; mso-hansi-font-family: Calibri; mso-hansi-theme-font: minor-latin;} Here So the GDP for the 3 rd
quarter revised down again to reach 2.2 points. It is interesting to recall an era U.S. GDP estimate showed an increase of 3.8 points. Therefore the U.S. GDP was revised down by over 40%! But this did not upset the financial markets continue to rise, reaching levels almost never seen in terms of valuation (taking into account inflation). What is surprising is that the reason given for this further decline is "the weakness of investment is much higher than expected." I must admit that this statement is to me an indirect admission of the failure of U.S. financial model. Indeed, the indices we jumped from 70 to 100% within 9 months. Theoretically, the level of indices is meant to reflect the true level of investment but in this case how this can he, with a rebound (taking into account inflation) from one of the largest ever observed on financial markets, we can have a low level of investment also. The answer is very simple investment was completely erased in favor of speculation. I will explain shortly how such a phenomenon is economically feasible. Anyway this poses two problems:
· First overvalued assets poses a risk of blow on the economy in case of 'bubble burst. In addition, companies may not pay dividends without charge social consequences because profits not follow. Indeed, if one takes the case of U.S. corporate profits are still lower by over 80% in 2007.
· I talk a lot with my teachers who are economists and I can also tell you they are not happy because even if everyone is euphoric shows the truth is not very nice to say . Indeed, over the last 6 months colossal resources were deployed: a stimulus plan of 830 billion dollars, a plan to help the banking industry for 730 billion (TARP), the purchase of MBS ( mortgage-backed securities) by the Fed to 1.35 trillion, 65 billion for General Motors, 400 billion for Fannie Mae and Freddie Mac etc ... The U.S. has introduced more 30 points of GDP (I think the true number is much higher) in stimulating economic and banking eventually withdraw only 2.2 points of GDP growth, but apart from some economists and managers of large investment funds that long term n 'seems to disturb anyone.
can really worry about this mismatch between means implemented by states and the results in terms of GDP as the absolute economic performance is ridiculous compared to the means employed. One can only worry about too, like many members of the Federal Reserve from late next plans to help real estate or even scrapping because right now the economy depends only public demand, private demand is insignificant.
Subscribe to:
Post Comments (Atom)
0 comments:
Post a Comment