Not Being an Economist, STILL
…I don’t think this is exactly a recessionary number.
U.S. economy grows at 3.9% pace in third quarter
The U.S. economy shook off the worst housing downturn in a generation to grow at a 3.9% annual pace in third quarter, the best performance in six quarters, the Commerce Department estimated Wednesday.
Make that ‘numberS‘.
…Despite rising worries about commodity prices, the GDP price index, the broadest measure of price changes in the economy, rose just 0.8% annualized, matching a nine-year low.
So whence the continual drumbeat of doom?
…A total of 8% of Americans say that the national economy is getting better, 18% say it is staying the same, and 69% say the national economy is getting worse.
I don’t get it. More…
…Consumers, whose spending is an important ingredient for the economy’s good health, actually rediscovered their appetite to spend in the third quarter. Their spending rose at a 3 percent pace, a considerable improvement from the second quarter’s rather weak 1.4 percent growth rate.
One of the reasons why people are continuing to spend is because the nation’s employment climate has managed to stay fairly sturdy despite all the problems facing the economy. Job creation perked up in September and wages grew solidly. The unemployment rate crept up to 4.7 percent but that is still low by historical standards.
Wage and job gains have served as shock absorbers for some of the negative forces of an ailing housing market, weaker home prices and more restrictive credit.
We’re doomed. Has no one asked a Democrat to explain the numbers? I haven’t heard anyone yet. They just prattle on and on and the media buys it, if not out and out does their own spinning, while guys like Larry Kudlow are called cranks/Bush apologists. Or worse.
Thanks to this, Charlie Rangel will get handed the chance to screw Joe Taxpayer in a year and won’t, as Gunnery Sergeant Hartman says,
“….even have the goddam common courtesy to give him a reach-around.”
Media | tree hugging sister | 
October 31, 2007 8:43 am
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The ailing housing market is a good thing, and a correction was long overdue. When people are sinking their money into overpriced housing, the rest of the economy suffers.
I agree and not only that ‘over-priced’. Common sense would dictate if you bring home $2500 a month, a $350,000 is out of your price range. Period. And it’s not an ‘unscrupulous’ lender’s fault you signed the paperwork. You were a ‘greedy’ borrower and he was merely a greedy lender who is now stuck with your house and thousands of others like yours ~ as it should be.
A long time ago a sage named NJSue told me, “Just because the bank says they’ll give you umpteefrats, doesn’t mean you can afford umpteefrats.”
Well, over-extension of credit led to a lot of the over-pricing in a positive-feedback loop. When I bought my house, no lender would give me more than 2.5X of my yearly salary.
Two or three years later and people were getting 3 – 4X of their salary from the bank, no down payment, and were allowed (in the NYC market, anyway) to take out a second mortgage right away to finance the rest of the debt. Hence apartments in the Village with less floor space than the room I keep my cats’ litter box in going for $600,000. I know of one co-worker buying a one-bedroom with a tiny living room / kitchen for $650,000 in 2005. Nuts.
And don’t get me started on how those “interest only” loans pushed prices higher by both loosening credit and by encouraging speculators.
Hmmmm.
What grates my cheese in this nonsense is that the lending banks now want a federal bailout.