Economic contraction no reason to panic
The performance in the fourth quarter wasn't good, to be sure. But consumer and business spending rose, and economists say they expect a rebound in the current quarter.
That's good advice when an alien construction crew demolishes your planet to make way for an inter-planetary highway and good advice in these uncertain economic times.
While the country's gross domestic product did contract 0.1% from the third to the fourth quarter in the wake of Superstorm Sandy, the news wasn't all bad. Consumer spending rose 2.6%, an improvement from a gain of 1.6%. Spending by businesses increased by 8.4%, rebounding from a decline of 1.8%.
Though some may blame worries about the fiscal cliff for the economy's disappointing performance, IHS Global Insight chief U.S. economist Nigel Gault isn't so sure.
"The incoming data points to continued growth, and we expect GDP growth to rebound to around 2% in the first quarter," he said in a press release.
Stocks reacted negatively to the GDP figures, which were worse than economists forecasted and marked the first contraction since 2009. Luckily for investors, related data from ADP showed U.S. companies added 192,000 jobs in January, beating expectations of a gain of 165,000, according to Bloomberg.
--Follow Jonathan Berr on Twitter @jdberr.
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There are good jobs for the PROPERLY educated. I see it as three problems as I did in the late 90's when my children were in college.
1) The kids today are not thinking seriously about the fact that they are BUYING a degree and what they are actually spending their future money on.
2.) The colleges will sell any degree to make money. They could care less that the student will need that degree to support them through life.
3) College loans are being passed out like free candy and the student isn’t living in reality as to what they are subjecting themselves to.
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About half of all patient admissions come through emergency rooms, creating yet another spending problem.
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[BRIEFING.COM] Commodities are mostly lower this morning, despite weakness in the dollar index, on broad market weakness. Crude oil and natural gas have slid lower since the overnight session and crude came close to the $93 level. July crude oil is now -0.9% at $93.38/barrel.
Natural gas fell about 2% off its overnight high and is still near its $4.22 session low. Currently, June nat gas is -0.8% at $4.23/MMBtu.
Precious metals have been modestly lower this morning with June gold ... More
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