Bruce Yandle's Economic Situtation Report - June 2012

THE ECONOMIC SITUATION
Bruce Yandle

June 2012
* The throttled economy, three years later.
* Europe’s trouble and U.S. exports.
* U.S. manufacturing muscle: What’s hot and cold.
* How are the states faring?
* Hope and the ordeal of change.

Latest Readings on a Throttled Economy
The Great Recession ended in June 2009. But like Lazarus of old, the recession seems to be rattling out of the grave. Consider the most recent headline data on the economy. The second reading on first quarter GDP growth came in at 1.9%, down more than a tad from the 2.2% first reported. The level of GDP is now higher than when the recent recession began, which means the economy is expanding, but the pulsebeat is so weak that more often than not, news commentators and government officials speak of recovery, not expansion. They show that they are nervous.

Then there’s the second round of the European debt crisis, with questions as to whether the latest trouble will bring down U.S. growth.

Shortly after getting the weak GDP growth numbers, we received yet another pitiful reading on employment growth. For a second month, the economy produced fewer than 100,000 new jobs, and May’s unemployment rate nudged up from 8.1% to 8.2%, an increase that is probably not statistically meaningful.

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