The economy unexpectedly contracted in the fourth quarter, but analysts said there was no reason for panic given that consumer spending and business investment picked up. Gross domestic product fell at a 0.1 percent annual rate, its weakest performance since the economy emerged from recession in 2009, the Commerce Department said on Wednesday. If it were not for the hit from slower inventory growth and the deepest plunge in defense spending in 40 years, the economy would have grown at a respectable 2.5 percent rate. In addition, economists said Superstorm Sandy, which struck the East Coast in late October may have reduced GDP by about half a point. "Obviously, the headline number is...Read more
Monthly Archives: January 2013
Inventories of previously-owned US homes fell to a 11-year low in December as eager Americans keen to take advantage of record low mortgage interest rates and depressed house prices snapped up existing supplies. Total housing inventory at the end of December fell 8.5 per cent to 1.82m existing homes available for sale last month – the fewest since January 2001 – the National Association of Realtors said on Tuesday. The inventory-to-sales ratio fell to a 4.4 month supply at the current sales pace, down from 4.8 months in November. This is the lowest housing supply since May 2005, near the housing boom peak, when it was 4.3 months. Slow and steady...Read more
Five years ago, the world economy seemed to be doing fine.
But it wasn’t. The fourth quarter of 2007 was the peak for the American economy. It began a mild recession in early 2008 that turned into a severe one by late in the year, when the credit crisis spread to most of the world. A few countries escaped recession, but virtually no one was able to avoid severe bear markets in stocks. The accompanying charts look at changes in gross domestic product and stock markets around the world since the end of 2007. In some countries, including the largest developing economies in Asia, the G.D.P. charts show no...Read more