Economic Summary - August 2009
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Based on the following key indicators, the U.S. economic decline has slowed but the bottom has not yet been reached. This recession will become one of the most severe recessions seen in a number of years and the debate about who caused it or who is prolonging it is a political question. The fact remains that our economy is cyclical where up and down cycles are a normal and expected economic outcome. When a sustained increase-more than a single quarter-in gross domestic product (GDP) occurs, then this recession will be over. Lagging indicators; unemployment, which will continue to increase, personal income, and real personal consumption may continue to decline providing real economic pain.
Keep a close watch on consumer price index (CPI) for inflationary signs that will have an impact on Personal Income and Real Personal Consumption. The price of oil is a leading indicator which can have a significant impact on CPI. We are all in a wait and see mode which is not conducive to economic growth.
Consumer Price Index
The U.S. CPI reported monthly rose slightly at 0.75% in July-214.5 over June's rate of 212.9.
Personal Income
Personal income stood at 11,989.8 in the second quarter; an increase of 0.91% over the 11,881.8 from the first quarter.
Real Personal Consumption
Real personal consumption was at 9,180.5 at the end of the second quarter down 0.31% from 9,209.2 in the first quarter.
Unemployment
The U.S. unemployment rate dropped from 9.5% in July to 9.4%.
Oil Prices
The price of West Texas Crude stood at $74.11 per barrel up 15.6% from July's close of $64.10 per barrel.
U.S. Gross Domestic Product
Gross domestic product (GDP) finished the second quarter at 12,892.5 down 0.25% from 12,925.4 in the first quarter of 2009
Industrial Production
Industrial production ended July at 95.4 down 0.42% from June's rate of 95.8.
Let me know if you have any comments, questions or suggestions. Write David W. Weatherholt at david@bnewsviews.com
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Business/News & Views® / by David. W. Weatherholt
ISBN: 978-0-9823041-1-2 (electronic format)
Published in the United States of America through www.waconsult.com
Published in an electronic format by Weatherholt & Associates, LLC
First Trade Publishing: October 2008
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