The media have touting the reported 3.5% in Gross Domestic Product for the last quarter. Hey, the economy is booming!
Not really. When you examine the growth, you will see that more than half was related to a pull-ahead program "Cash for Clunkers." The 4th quarter will see that paid back. There has been some replacement of product inventories by manufacturers. What is absent is consumer spending outside of the "clunkers" blip... and that is likely to remain absent for some time as employment, housing, and personal investments remain severely depressed.
It good to be optimistic to the extent that it is realistic. Right now it is hardly realistic. Looking around, the equities markets are highly optimistic given the economic realities. That should flash "proceed with caution" to anyone with spare cash burning a hole in his pocket.
In the Detroit area, General Motors has shown some signs of life, but once again closer examination shows that they are moving the metal with high incentives... and many of their sales are for leftovers from 2009 that carry a lower price tag than their new models.
This is still a bargain-hunter market and is likely to remain that way for some time. The Obama administration is hoping to spend enough future taxes now to stimulate a real recovery, but they may only be succeeding is devaluing the dollar and driving a "bomb shelter" mentality in businesses that see only more tax burdens and downtrodden taxpayers.
We've gotten the change, but not what 52% of Americans hoped for... you know, that overwhelming majority behind this nonsense.