Obama faces new headache as the US economy stumbles


The scale of the slowdown in US growth this year will be starkly underlined by new figures this week raising questions about whether the world’s biggest economy can regain momentum.

Expansion in gross domestic product (GDP) is expected to have slowed to 1.8pc in the first quarter of the year from the 3.1pc seen in the final three months of 2010, according to Wall Street economists.

Most point out that a combination of higher oil prices, a particularly harsh winter in the US and the earthquake in Japan all proved unexpected constraints on a quarter that in December was forecast to provide further evidence of a strengthening recovery.

“Things are not looking that good,” said Yelena Shulyatyeva, an economist at BNP Paribas, which is predicting that the US will see growth at 2.5pc this year. “The situation has changed.”

The consensus for US expansion this year among economists on Wall Street has edged down from above 3pc at the start of the year to 2.9pc, matching last year’s figures.

The state of the US economy is important for the rest of the world, not only because of its size, but because America is one of the few developed economies that has chosen to focus on growth rather than tackling the deficit.

Read more

0 0 votes
Article Rating
Notify of
Inline Feedbacks
View all comments

We went right from the frying pan directly into the fire, and I kept asking what the hopey changey thing was all about….now, I guess we all know…I do hope everyone is enjoying it… (emphasis on the sarcasm).

Side track: I have not seen much “Outrage” over the Gas Prices. Where is it? Had this been Bush, the left would have had multi protests with a noose around his neck by now. He would have been called every vile name there is …

Obama’s p poor policies have and are keeping families apart especially those who live long distances (think about that – Obama the Uniter) from seeing each other. People now, on top of all their other budgeting, have to add a ‘huge’ gas expense into their budget just so they can go see family members especially those who live distances apart….

So, why is the left not fired up about this? This is absolute (Republican policy) ’emotional’ trauma for them!! Where is the Outrage from the left? Where is their ’emotional rationale’ ?! The Rhetoric? Why are they not protesting Obama? (as they would Bush) Gas Prices? Why are they letting this crisis go to waste? ?

Oh, I forgot, cash for clunkers, more economical cars will save gas (so, according to Obama logic ? there should be a surplus of gas right now? Supply and demand? ), Or perhaps the dollar is not worth…

but only the right has bad policies and is, well, Evil…

The only headache for Obama over this latest economic news is that it makes his re-election campaign a bit harder. As an issue itself, the poor economic outlook is pretty much what he was shooting for in the first place…

The last Republican budget was 2006 when unemployment was 4.6 and the deficit was 168 billion. In 2007 the democrats promptly double the budget the first time. In 2008 the democrats destroyed a fast three million jobs in the two months following the minimum wage hike. Of course Republicans predicted that and when it came true democrats just pushed their finger deeper in their ears. Then in 2009 Bush never even SAW the budget because democrats were playing shenanigans in an election year and did their best to hide the budget from the public. The budget for 2009 was signed by Obama because it was so late. Now after four years of democrat budgets the deficit is 1.7 trillion and real unemployment (U6) is at 20%.

Look up ‘Community Re-investment Act’. Lookup ‘Barney Frank defends Freddie and Fannie’, look up ‘Chris Dodd denies problems with Freddie and Fannie’, Look up how democrats forced banks to give loans to people who could never pay them back so much it overloaded the system with bad debt and the market crashed.
Thank your democrats for this recession.And for upcoming double dip recession? Thank Obama for printing money with the intention to speed inflation to make your money worth less and less.

This is a stroke of absolute brilliance…

Energy in America: EPA Rules Force Shell to Abandon Oil Drilling Plans


At stake is an estimated 27 billion barrels of oil. That’s how much the U. S. Geological Survey believes is in the U.S. portion of the Arctic Ocean. For perspective, that represents two and a half times more oil than has flowed down the Trans Alaska pipeline throughout its 30-year history. That pipeline is getting dangerously low on oil. At 660,000 barrels a day, it’s carrying only one-third its capacity.

Production on the North Slope of Alaska is declining at a rate of about 7 percent a year. If the volume gets much lower, pipeline officials say they will have to shut it down. Alaska officials are blasting the Environmental Protection Agency.

“It’s driving investment and production overseas,” said Alaska’s DNR Commissioner Dan Sullivan. “That doesn’t help the United States in any way, shape or form.

Now link that with this…

OPEC Unlikely to Change Output Despite Price Surge


“Increasing production is a sovereign issue for Saudi, and it’s been said over and over again that Saudi is ready to fill any supply gap,” said another Gulf OPEC delegate.

Yup. Sovereignty. We used to have some. We used to have Economic Literates in Government. This should be an Election issue. But with the Lunatics running the asylum we will remain energy dependent and be paying through the nose for it. Now how many of You voted for $5.00 or $6.00 gasoline. Or an Agency that has not permitted a new Refinery since 1976? Don’t any of you jump up at once…

I recall that well before the so-called ”Arab Spring,” with its revolutions in Egypt, Yemen, Bahrain, Libya and elsewhere, oil experts were saying that Obama’s energy policies alone would cause Americans to be paying more for gasoline by this summer.

Remember, it was well before all of the Arab revolts that Obama was freezing out oil drilling everywhere.
Only the remnants of Bush’s policy kept oil plentiful til now.

And it was during Bush’s presidency that we all realized China was increasing its use of oil, forcing up world prices, too.

But what had Obama done?
He promised us ”alternatives” to fossil fuels.
First we saw food prices go up as higher gas prices impacted what it costs to get food to market.
Now we see gas prices rise daily.
(One weekend we saw the price go up 24 cents/barrels here, locally.)

We currently import almost 10 million/gal a day and domestically produce almost 6 million barrels.
Obama wants us to check our tire pressure and trade in perfectly good cars for untested electric ones.
If everybody drove as efficient a car as he/she could get by with we could save about 2.5 million barrels a day.

If Obama allowed us to drill and refine at home we could add another 4 million barrels/day JUST from economically viable reserves.
That, alone would cut our imports by 2/3rds!
Instead of this we hear Obama plans to force us to buy more from foreigners….namely Brazil.
And Obama will not quit demonizing oil producers who, despite their large profits, pay more in taxes and permits than they collect in profits worldwide.

While the bad economic news isn’t a surprise to me, I have to wonder if CBO is going to go back thru all their projections for various legislation (including all the jokes offered to us as “budgets”), which usually use a GDP growth assumption, to fix all the rosy spots with real numbers.