From the "no kidding, Sherlock" WashPost: "New Economic Reports Show We're Still Hurting"
The fragile economic recovery has relied heavily on government stimulus spending, but new data show that as the money runs out, a sustained rebound may be elusive.And in case you missed it: "Stimulus spending doesn't work." Stand by for unemployment numbers tomorrow; Joe Biden will be out later to explain all the jobs "saved."
The dramatic decline in sales reported Thursday by the Big Three automakers suggested the extent to which the stimulus act has propped up the economy. The government's wildly popular "Cash for Clunkers" program drove consumer spending to its highest level in eight years in August. But after it ended, so did the growth in auto sales.
General Motors' sales plunged 36 percent in September compared with August. Ford plummeted 37 percent. Chrysler dove 33 percent.
Cash for Clunkers "was a one-time boost of sales followed by a crater," said Ben Herzon, an economist at Macroeconomic Advisers. The firm forecast that the program was likely to have no effect as a stimulant for national economic output.
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I'd hate to be the one who has to break the bad news to those leftwing hippie Obama apologists at the Wall Street Journal:
http://online.wsj.com/article/SB125185379218478087.html
SEPTEMBER 2, 2009
U.S. Economy Gets Lift From Stimulus
WASHINGTON -- Government efforts to funnel hundreds of billions of dollars into the U.S. economy appear to be helping the U.S. climb out of the worst recession in decades.
Much of the stimulus spending is just beginning to trickle through the economy, with spending expected to peak sometime later this year or in early 2010. The government has funneled about $60 billion of the $288 billion in promised tax cuts to U.S. households, while about $84 billion of the $499 billion in spending has been paid. About $200 billion has been promised to certain projects, such as infrastructure and energy projects.
Economists say the money out the door -- combined with the expectation of additional funds flowing soon -- is fueling growth above where it would have been without any government action.
Many forecasters say stimulus spending is adding two to three percentage points to economic growth in the second and third quarters, when measured at an annual rate. The impact in the second quarter, calculated by analyzing how the extra funds flowing into the economy boost consumption, investment and spending, helped slow the rate of decline and will lay the groundwork for positive growth in the third quarter -- something that seemed almost implausible just a few months ago. Some economists say the 1% contraction in the second quarter would have been far worse, possibly as much as 3.2%, if not for the stimulus.
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