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No Double-Dip Deja Vu Seen for U.S. Economy - I don't believe it..
had to share this article.. can we continue to listen to this propaganda being forced on us.. day after day. I do not see things improving. I do not see the unemployment rate decling. Nor do I see companies spending money. The hoarding has and will continue I fear. will lead to further contraction.
No Double-Dip Deja Vu Seen for U.S. Economy
Deja vu it ain’t.
The U.S. looks unlikely to suffer the same sort of swoon this year as the one in 2011: Household, bank and company balance sheets are stronger, and the shocks hitting the economy so far are weaker, with retail sales rising more than forecast as gasoline prices show signs of slipping from an early-year increase.
William C. Dudley, president and chief executive officer of the Federal Reserve Bank of New York, said “the recovery may be finally establishing a somewhat firmer footing.”
David Nelms, chief executive officer of Discover Financial Inc., said “consumers are continuing to gradually grow their spending.”
David Nelms, chief executive officer of Discover Financial Inc., said “consumers are continuing to gradually grow their spending.” Photographer: Tim Boyle/Bloomberg
Consumer-loan delinquencies fell across the board in the fourth quarter, the first time that’s happened in eight years, according to the American Bankers Association in Washington. Banks have reduced leverage, with financial-institution debt as share of the economy at its lowest level in a decade. And corporations are flush with cash: The ratio of liquid assets to short-term liabilities is the highest since 1954, based on data compiled by the Federal Reserve.
“It feels eerily similar to last year, but fundamentally it’s quite different,” said Joseph LaVorgna, chief U.S. economist for Deutsche Bank Securities in New York. He sees the economy growing 3 percent in the fourth quarter from a year earlier, compared with 1.6 percent in 2011.
That’s good news for the stock market and for companies such as Discover Financial Services. (DFS) Net income for the three months ended Feb. 29 rose 36 percent to a record $631 million, or $1.18 a share, the Riverwoods, Illinois-based credit-card issuer said March 22.
‘Grow Their Spending’
“Consumers are continuing to gradually grow their spending,” Chairman and Chief Executive Officer David Nelms said in an interview. “They’ve finished a lot of the deleveraging that they’re going to do on credit cards and auto loans.”
BlackRock Inc., the world’s biggest asset manager, remains bullish on the U.S. stock market in spite of lower-than-forecast March payroll growth, according to Bob Doll, chief equity strategist of the New York-headquartered company. Job creation fell to 120,000 from 240,000 in February.
“We do not believe that fundamental macro conditions have changed enough, or at all, to warrant a downgrade of our view toward equities,” he said in an April 9 note to clients.
Doll has said he sees a “double-digit” gain for the Dow Jones Industrial Average in 2012. It was 12,849.59 (INDU) at 4:00 p.m. on April 13 in New York, up 5.2 percent since the start of the year, though 3.1 percent off the 2012 high set on April 2.
“We have much better momentum this year than we did last year,” said Chris Varvares, senior managing director of Macroeconomic Advisers LLC. “We’re a year further along in terms of improvement in lending terms and household balance sheets.”