From a write-up on “the truth” of the U.S. economy (bolding by EleBlog) –
Even the PCE (Personal Consumption Expenditure), which measures all goods and services consumed by Americans and is a component of the GDP, is doing poorly. After two months into the second quarter of 2014, the PCE is not even with or ahead of first quarter 2014, which means U.S. consumers are not buying products or spending money. They are tapped out. This narrative in the media that the consumer is back is just downright wrong because it is belied by fact.
Durable goods orders reported the week of June 23, 2014 tumbled 1 percent, so far the biggest miss in 2014. On a year-over-year basis, durable goods are negative, not great news for second quarter GDP. The truth is we are now living on borrowed time. The U.S. GDP is the worst it’s been in five years. U.S. employment participation rate is the worst it’s been in 37 years. The U.S. food stamp recipients are now over 50 million Americans, and somehow the S&P 500 hits a new high. It just doesn’t add up.
Investors need to ground themselves and remember the crash of 2008, because just like back then, there were harbingers of the correction to come. Investors need to be cautious because there are plenty of signs coming from both the market and the economy that vigilance is a wise choice at this time. Portfolios don’t have to drop 35 or 50 percent like back in 2008.
Source: http://electricalcontractor.com/?p=15163
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