U.S. economy grows at 4.8% Q-Q annualized rate

[KrazyHorse]

Originally posted by Zkribbler
Not really. He's quite intelligent really.

[Kidlicious]

Originally posted by Zkribbler
He's arguing that it never makes economic sense.

Does anyone want to argue that defict spending always or usually makes economic sense?

I support (demand side) deficit spending in a recession when monetary policy isn't working actually.

[TCO]

I can't hear YOU!!

[Kidlicious]

[TCO]

Huh?

[One_more_turn]

Originally posted by Kidicious


By that account we should be in a recession.

What are you talking about?

Crude oil price goes up if the economy accelerates, and goes down if the economy slows down. Supply and demand at work beautifully.

Investing in oil stocks has so far paid off handsomely for me this year. But since too many people whine when oil price gets too high, the Gold is a better investment at moment.

[Kidlicious]

Originally posted by One_more_turn
Crude oil price goes up if the economy accelerates, and goes down if the economy slows down. Supply and demand at work beautifully.

I thought you were saying something different, but don't you think the supply of oil is a limiting constraint on the economy?

[One_more_turn]

Originally posted by Kidicious


I thought you were saying something different, but don't you think the supply of oil is a limiting constraint on the economy?

Exactly!

[TCO]

Don't quote him. Reply if you must. Preferable really to snub him hard.

[Vanguard]

4.8% is a very nice rate of growth and is welcome, though of course it is not an especially great achievement when you remember that over the last six month the US has also increased its debt by 5% of GDP.

[pchang]

http://news.yahoo.com/s/nm/20060501/bs_nm/economy_income_dc_5

Consumer income increased by 0.8%. Consumer spending index increased by 0.4% during the same time period. Core inflation was 0.3% during the same period.

[TCO]

uh...and that means?

[Dinner]

He's saying that inflation is in check so most of that 4.8% is real growth.

[Vanguard]

I'm going to quibble here.

While it it true that the economy grew in this period at a high rate, that rate of growth must be offset at some future time to pay off the debt we incurred to get the growth now. That is what debt does. It transfers growth from the future to the present.

This is very nice for people who can avoid the consequences of future slow growth. But for people who will earn more of their money in the future than now, this is no growth at all.

[Kidlicious]

Originally posted by Vanguard
I'm going to quibble here.

While it it true that the economy grew in this period at a high rate, that rate of growth must be offset at some future time to pay off the debt we incurred to get the growth now. That is what debt does. It transfers growth from the future to the present.

Except that we really don't have to reduce our debt, and we shouldn't if it's going to reduce growth. All we really have to worry about is interest rates getting to high again, so eventually the deficit could be a problem. Surpluses serve no real purpose though.