US GDP: 2013 Revised downward to 1.9%

[JohnyMac]

Released by Bureau of Economic Analysis this past Friday, that the US's GDP final number came in at 1.9% 90 bases points below 2012 (2.8%).

I am looking forward to the U3 first time unemployment numbers for February coming out this Friday at 8:30AM ET. I have been reading that the number will tick up due to the "poor weather" in January and February. January U6 unemployment 12.7%.

Looking at new house starts January fell 16% compared to same month LY. I have been reading that February will be worst. This is also being caused by the harsh winter.

Existing home sales dropped 5.1% compared to same time LY. This is the fifth time in 6 months. The reason given was increasing mortgage rates. Similar to new housing starts, February is expected to be the sixth month of negative numbers out of the past seven.

I did a unscientific pole while up at the cabin of local mom & pop businesses. There was not one business that had a increase over LY's top line revenue for Jan & Feb 2014. As a matter of fact all but one had not been flat or positive to LY's sales since September 2013. Several of the businesses had laid off some employees. All of the others had reduced working hours of employees.

Here were the top four most heard excuses for reduced top line revenue in the county that my families cabin is located in:

- No extension of unemployment benefits.
- The implementation of the ACA (Affordable Care Act). This is causing increases to customers monthly healthcare
  payments hence less surplus discretionary money for "stuff and fun."
- Unemployment in the area has increase notably.
- The majority of the Marcellus wells have been put in and the men that came to the area for the drilling have left for a
  new area of the state/country.

We will all know my the end of March as to where the economy is going. It is not looking good though.

Stay tuned...
   

[JohnyMac]

I ran across this today and thought I would share. Please be aware that the article comes from Economic Collapse who has a vested interest in the Economy Collapsing. With that said, I did a quick google investigation on the top 6 items and they were in fact right on. Do your own homework! I left out the commentary at the end of the article.

We recently learned that the number of new mortgage applications in the United States had fallen to the lowest level that we have seen in nearly 20 years.

#2 Radio Shack has announced that it is going to close more than 1,000 stores.  This is just another sign that we are in the midst of a "retail apocalypse".

#3 The ISM Services index just fell to its lowest level in 4 years, and ISM Services Employment just experienced its largest decline since the collapse of Lehman Brothers.

#4 Obamacare is really starting to hammer the U.S. health care industry...


"The Affordable Care Act is creating significant financial uncertainty to health care organizations," said a survey respondent from the health care and social assistance industry.

"With little warning, the negative impact on revenue has been unprecedented."

#5 Trading revenue at the "too big to fail" banks on Wall Street is way down...


Citigroup Inc. (C) and JPMorgan Chase & Co. (JPM) are bracing investors for a fourth straight drop in first-quarter trading, a period of the year when the largest investment banks typically earn the most from that business.

Citigroup finance chief John Gerspach said yesterday his firm expects trading revenue to drop by a “high mid-teens” percentage, less than a week after JPMorgan Chief Executive Officer Jamie Dimon said revenue from equities and fixed income was down about 15 percent. If trading at the nine largest firms slumps that much, it would extend the slide from 2010’s first quarter to 36 percent.

#6 One of the "too big to fail" banks, JPMorgan, is planning to fire "thousands" more workers.

#7 Moody's has downgraded the credit rating of the city of Chicago again.  Now it is just three notches above junk status.

#8 The U.S. economy actually lost 2.87 million jobs during the month of January according to the unadjusted numbers.  Over the past decade, the only time the U.S. economy has lost more jobs during the month of January was in 2009 at the peak of the last recession.

#9 In January, real disposable income in the U.S. experienced the largest year over year decline that we have seen since 1974.

#10 Only 35 percent of all Americans say that they are better off financially than they were a year ago.

#11 Global retail sales for machinery giant Caterpillar have fallen for 14 months in a row.

#12 The economic data show that virtually all of the largest economies on the planet are slowing down right now.  The following is from a recent Zero Hedge article...


The last 3 weeks have seen the macro fundamentals of the G-10 major economies collapse at the fastest pace in almost 4 years and almost the biggest slump since Lehman. Despite a plethora of data showing that 'weather' is not to blame, US strategists, 'economists', and asset-gatherers are sticking to the meme that this is all because of the cold on the east coast of the US (and that means wondrous pent-up demand to come). However, as the New York Times reports, for the earth, it was the 4th warmest January on record.

For much more on how the rest of the global economy is also slowing down, please see my recent article entitled "20 Signs That The Global Economic Crisis Is Starting To Catch Fire".

Meanwhile, things in Ukraine continue to become even more tense, and the Russian government continues to debate how it will respond if the U.S. does end up deciding to hit Russia with economic sanctions.

According to one Russian news source, the Russian parliament is actually considering the confiscation of the property and assets of U.S. businesses in Russia if the U.S. decides to go ahead with economic sanctions against Russia...


The upper house of Russia’s parliament is mulling measures allowing property and assets of European and US companies to be confiscated in the event of sanctions being adopted against Russia over its threatened military intervention in Ukraine.

We are talking about banks, retail chains, mining operations, etc.

U.S. companies have billions invested in Russia, and all of that could be gone in an instant...

On another note: Staples just announced that they were going to close 255 stores by the end of 2015.

The company I use to work for (West Marine) just had their year end investor conf. call and announced that they had a -1.8% comp in 2013. 2013 earning's per share came in at 32¢ per share vs. 2012's earning's of 62¢ per share. 2014 EPS projection is 39-45¢ a share - Ouch!   

Stay tuned...