Fourth quarter 2014 real GDP was revised 0.4 percentage points lower to 2.2%. That's quite disappointing, although still mediocre growth. The reason for the revision reduction was inventories did not grow nearly as much as originally estimated and imports increased. Real consumer spending was barely revised. Overall Q4 GDP cutting isn't that surprising, more Q3 GDP's lack of trade deficit impact was.
The Consumer Price Indexdropped -07% for January, the largest monthly drop since December 2008 and the steepest monthly decline in a series of seven. Gasoline prices plummeted -18.7%, the steepest since December 2008. The drop in gas overwhelmed the Consumer Price Index and was the cause of the overall drop.
The first attack on Social Security this year was with the false accusation that there was rampant fraud in the disability program, when two different reports show only 0.4% fraud in the program — far less than any other government program — and probably far less than employee theft in the private sector — and much less that's found in the defense industry.
The January 2015 New Residential Single Family Home Sales decreased -0.2% to 481,000 in annualized sales. This change is maintaining six year highs and this month is well within the statistical error margin of ±22.2%. . For the year, new single family home sales are up 5.3% from the January 2014 457,000 sales levels.
The December 2014 S&P Case Shiller home price index shows a seasonally adjusted 4.5% price increase from a year ago for the 20 metropolitan housing markets and a 4.3% yearly price increase in the top 10 housing markets. There are two ways to look at the never ending increasing home prices.
The bitter cold blew in more than snow for January. Existing home sales suffered as well with a -4.9% decline in sales for the month. This is the biggest monthly drop off in nine months with single family homes declining by -5.1% in sales. Sales by volume are now 4.82 million in January. April 2014 showed 4.75 million annualized sales.
With all the heated debates about our skyrocketing debt and ballooning deficit — not to mention, all the rampant fraud in our government social programs — how can the U.S. afford another war? Will we use PAYGO — and pay as we go into war?
Probably the most interesting economic report of those released last week was the January report on the Producer Price Index from the Bureau of Labor Statistics, which showed the headline producer price index for final demand had fallen by a seasonally adjusted 0.8% for the month, after falling 0.2% in both November and December, and which left year over year wholesale inflation unchanged. Both the monthly decrease and the year over year change were the greatest drop that this new PPI index has ever shown in the two years
Last week members of the Alliance for Retired Americans (the Alliance) met with over 120 members of Congress and staffers in their home districts to take a stand on Social Security, Medicare and the Trans-Pacific Partnership.
As an engineer who has argued that there has never been sound theory of economics (see link below), I thought it might be interesting to apply my heterodox approach to the recent headlines which reported China's PPP derived GDP as narrowly surpassing that of the USA.
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