Thursday, May 1, 2014

Recession Alert: U.S. Economy Expands by Just 0.1% In First Quarter, If It Wasn’t For Obamacare, Q1 GDP Would Be Negative

GDP Shocker: US Economic Growth Crashes To Just 0.1% In Q1
Despite consensus at 1.2% growth QoQ, the “weather” destroyed the fragile stimulus-led economy of the US which managed only a de minimus +0.1% QoQ growth (the lowest since Q1 2011). However, as Steve Liesman noted on the heels of Mark Zandi’s comments “basically ignore this number” – ok then. Spending on Services, however, surged by the most since 2000 - heralded as great news by some talking heads – but is merely a reflection of the surge in healthcare and heating costs (imagine if it had not been cold and if Obamacare hadn’t saved us). As a reminder – this is the growth that is occurring as QE has run its course, as stimulus ends, and as escape velocity nears… if the “weather” can do this much damage to the US economy, should stocks really be trading at the multiple of exuberant future hope that they are?
 
Oops!
U.S. GDP posts smallest gain in three years
Scant 0.1% gain a residue of bad weather, spring may revive growth
Economists polled by Reuters had expected growth to slow to a 1.2percent rate. The slowdown partly reflected an unusually cold anddisruptive winter, marked by declines in sectors ranging from businessspending to home building.
“If health-care spending had been unchanged, the headline GDP growth number would have been -1.0%,” Shepherdson said.
If It Wasn’t For Obamacare, Q1 GDP Would Be Negative
 
US Mortgage Applications Sink To Lowest Level Since December 2000
NEW YORK (Reuters) – Applications for U.S. home mortgages fell last week to their lowest level since December 2000 as both refinancing and purchase applications declined, an industry group said on Wednesday.
 
 
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and home purchase demand, fell 5.9 percent to 333.2 in the week ended April 25. That was the lowest level since December 2000, the group said.
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