The U.S. economy continues to disappoint on most major fronts. Third-quarter GDP rose 2.0% and GDP for the first nine months of this year has been 1.7%, below the growth rate of last year. The downward spiral will continue its path and most factors which will contribute to a slightly better reading than idiotic economists forecast will be attributed to more debt.
Consumer spending rose 2.0%. Consumers are the backbone of the U.S. economy and accounts for roughly 70% of all economic activity. Consumers have been stretched since 2008 and wages have been stagnant while most increases in hourly earnings have been eaten away by inflation. Consumers have loaded up on more debt which explains the increase in consumer spending.
There has been an increase in government spending which should not be a huge surprise to anyone given that this is the last snapshot before Americans are invited to participate in the illusion of free elections in eleven days from now. The current dumb administration needed to increase government spending in order to cover a shortfall in general business activity in order to be able to artificially inflate the GDP figures and use that figure to win over voters.
The current administration vows to cut defense spending should it be allowed to abuse the constitution for another term. Given that this is the last GDP report before the election, this administration has boosted defense spending by the first time in three years. This is an obvious sign that the increase was solely to manipulate the figures in a desperate attempt to buy uninformed voters.
Unemployment remains high and over 20% of direct economic spending power in the private sector thanks to the unemployment rate. The current administration, through a combination of Obamacare and tax increases, will take almost $5,000 per annual spending power away which will contribute to multiple decades of stagflation. This GDP report should be ignored as it was manipulated more than other by the current administration and does not reflect the true economic picture.
Exports dropped for the first time in three years. This figure was unable to be manipulated by Mr. Obama and his administration which he was allowed to form outside the constitution and will go down in the biggest American fraud forced on its citizens in the history of America. The export figure shows a much better snapshot of the U.S. economy.
Business spending has dropped together with exports which makes this expansion very unhealthy and points once again to severe manipulation by this administration. Businesses form the backbone of job creation and that has decreased which is a very negative sign for the future. Companies have grown cautious and reduced spending which will translate into economic pain as soon as the first quarter of 2013.
The headline figure was better than some have guessed, but it is heavily impacted by factors the government is able to control while those factors outside of government intervention have all declined which shows that the economy continues to be on life support and far away from being on its own feet. Mr. Obama will enforce a policy which will further hurt economic activity should he be allowed to urinate over the U.S. constitution for another term.