Conservative
Type 40
Suck on THAT, Chris! @you... but weeping for this country.
President Obama's 2012 Re-Election Prospects Suffer An Ominous GDP Report - Forbes
President Obama's 2012 Re-Election Prospects Suffer An Ominous GDP Report - Forbes
The BEA reported that real GDP grew at a 2.2% annual rate. This was lower than the 3.0% rate growth rate reported for 4Q2011, and much lower than would be normal for this point in a recovery from a severe recession.
Real business nonresidential fixed investment (RBNRFI) was lower in 1Q2012 than it was in 4Q2011, falling at a 2.1% annual rate, quarter to quarter. This continued a decelerating trend. After growing at 15.7% during 3Q2011, RBNRFI slowed to a 5.2% growth rate in 4Q2011 and then fell at a 2.1% rate last quarter.
Why does this matter? It matters because RBNRFI is what actually drives the economy.
An article in the January 26, 2006 issue of Business Week cited a study by Global Insight showed that, on average, it takes a 5% increase in RBNRFI to produce a 1% increase in payrolls. Given that Americas working age population is growing at about 1% per year, this means that it would take a 5% annual increase in RBNRFI just to keep unemployment from rising.
If RBNRFI were to continue to fall at 2.1%, as it did in 1Q2012, we could expect the total number of jobs in the economy to fall by about 1% over the next year, and for the unemployment rate to increase by about 2 percentage points (at a constant labor force participation rate). In other words, falling RBNRFI = recession.
Obama is the most virulently anti-investment president of the post-war era, and accordingly has delivered the worst economic performance of the post-war era.