True Pundit

Business Politics

“Trouble In Paradise” – Hopes Of Economic Growth Just Took A Beating

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The domestic economic growth story took a beating in the first half of this year with an average growth rate of just 1%. For the seventh year running, the data has dashed the hopes of an economic resurgence by the Fed and the vast majority of mainstream economists. Unfortunately, this smidgen of a growth rate could not be blamed on“extremely cold winter weather” which, ironically, tends to occur during the winter or high oil prices. Both provided theoretical boosts to the economy during the first half. So what gives?

The good news is that the weakness in Q1 led to another “inventory restocking” bounce in Q2 just as we have witnessed in each year since the financial crisis.  As I stated in 2014:

“With that inventory restocking cycle now complete, the current “Day After Tomorrow” syndrome will likely lead to another rundown/recovery cycle in the economy.  The economic drag caused once again by “Mother Nature”combined with the impact from the onset of the Affordable Care Act is likely to keep economic growth suppressed below expectations once again this year.” – READ MORE  

 

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