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Rebound: Economic growth hits 3.2% in Q1

Westlake Legal Group rebound-economic-growth-hits-3-2-in-q1 Rebound: Economic growth hits 3.2% in Q1 trade The Blog Imports GDP exports Economy donald trump

Westlake Legal Group TrumpPhoenixSpeechThumbsUp715-8-17 Rebound: Economic growth hits 3.2% in Q1 trade The Blog Imports GDP exports Economy donald trump

It’s been years since our operating philosophy was “it’s the economy, stupid,” but perhaps it’s time to return to it. Economic growth spiked upward in a quarter usually known for its retreats, hitting an annualized rate of 3.2% growth in Q1. That’s a full point above 2018Q4’s disappointing 2.2% growth rate:

Real gross domestic product (GDP) increased at an annual rate of 3.2 percent in the first quarter of 2019 (table 1), according to the “advance” estimate released by the Bureau of Economic Analysis. In the fourth quarter of 2018, real GDP increased 2.2 percent.

The Bureau’s first-quarter advance estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see “Source Data for the Advance Estimate” on page 2). The “second” estimate for the first quarter, based on more complete data, will be released on May 30, 2019.

The increase in real GDP in the first quarter reflected positive contributions from personal consumption expenditures (PCE), private inventory investment, exports, state and local government spending, and nonresidential fixed investment. Imports, which are a subtraction in the calculation of GDP, decreased (table 2). These contributions were partly offset by a decrease in residential investment.

Not only does it show a recovery from a disappointing previous quarter, it breaks a Q1 trend that had developed over the last few years. For some reason, economic growth measures in the first quarter became oddly depressed; the last three years, the Q1 GDP turned out to be the worst reading of each year, sometimes dramatically so as in the past two years.

That’s not to say that there aren’t some potential dark clouds on the horizon. Personal income didn’t increase as much in Q1 as it did in the previous quarter despite the higher growth rate. Disposable personal income only increased at an annualized rate of 2.4%, just over half the Q4 rate of 4.3%. That may have led to a falloff on the rate of growth for consumer spending (PCE), which fell from 3.5% in 2018Q3 to 2.5% in Q4, and again to 1.2% in Q1.

If consumer spending expansion didn’t drive the quarter’s growth results, what did? A significant drop in imports helped, falling 3.7% from the previous quarter. Exports also grew 3.7%, which doubled the impact from trade. Business investment had a strong quarter, growing 5.1%, mainly in intellectual-property investment. The growth rate of 2.5% for final sales to domestic purchasers shows that inventory expansion played a significant role in the overall GDP number too. However, with income and consumer spending growth slowing, those factors may well be too transient to expect them to last into Q2.

The Washington Post cheers the report with a headline that it “smashed expectations,” but also notes the longer-term issues:

The U.S. economy expanded at a strong 3.2 percent annualized rate from January through March, the U.S. Commerce Department said Friday, mainly because of companies beefing up their inventories and a smaller trade deficit, factors that aren’t expected to last.

Better-than-expected growth, the ongoing strength in the job market and fresh stock market highs this week are allaying fears that a recession or severe downturn is on the horizon.

Many economists initially predicted anemic growth at the start of 2019 as the partial government shutdown and a rash of extremely cold weather caused many businesses and consumers to hit the pause button on big purchases, but forecasters raised their estimates to 2.3 percent as it became clear companies were re-stocking their shelves. Growth ended up coming in almost a full percentage point higher than expected, the best start to the year since 2015.

Over half of the strong first quarter growth was driven by a surge in inventories and U.S. exports to other nations. State and local government spending also boosted growth by the biggest amount in three years.

Bloomberg highlighted weaker demand in the report:

Gross domestic product expanded at a 3.2 percent annualized rate in the January-March period, according to Commerce Department data Friday that topped all forecasts in a Bloomberg survey calling for 2.3 percent growth. That followed a 2.2 percent advance in the prior three months.

But underlying demand was weaker than the headline number indicated. Consumer spending, the biggest part of the economy, rose a slightly-above-forecast 1.2 percent, while business investment cooled. A Federal Reserve-preferred inflation measure, the personal consumption expenditures price index excluding food and energy, slowed to 1.3 percent, well below policy makers’ 2 percent objective.

Even so, the data showing faster growth and tame inflation helped push U.S. stock futures higher and Treasury yields lower on Friday.

Overall, it’s good news. It might just not be quite as good as the top-line GDP growth rate suggests. If any of the cautionary figures are still dealing with the Q1 reporting blues, however, we might see a very big Q2.

The post Rebound: Economic growth hits 3.2% in Q1 appeared first on Hot Air.

Westlake Legal Group TrumpPhoenixSpeechThumbsUp715-8-17-300x162 Rebound: Economic growth hits 3.2% in Q1 trade The Blog Imports GDP exports Economy donald trump   Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

Potemkin legislation

Westlake Legal Group Screen-Shot-2019-04-17-at-07.25.35 Potemkin legislation Work Women and equality Women wages Treasury ToryDiary Stella Creasy MP sport Sam Coates (The Times) Sajid Javid MP rent Public Sector Northern Ireland NHS Local government and local elections Local Elections (general) Liz Truss MP Julian Assange jobs James Brokenshire MP immigration housing Home and family Highlights healthcare Health football Family and relationships exports employment Elizabeth Truss MP Economy DUP divorce disability Diane Abbott MP David Gauke MP David Blanchflower Conservatives Abortion

The ten most recent subjects covered by the Conservative Party’s Twitter feed are as follows: record employment, the provision of free sanitary products in primary schools, Conservative councils recycling more than Labour ones, more statistics about work and wages, record women’s employment, workers’ rights, an exports increase, more disabled people in employment, an end to no fault evictions, Conservative councils fixing more potholes than Labour ones, banning upskirting, funding more toilets at motorway service areas to help people living with complex disabilities, Sajid Javid criticising Diane Abbott over Julian Assange, kicking out racism in football, and a new law to protect service animals.

One might pick out three main themes, local election campaigning aside.

The first is the vibrancy of Britain’s jobs market and the country’s robust recent record on employment.  The aftermath of the Crash and the Coalition’s slowing of public spending growth, a.k.aa “austerity”, didn’t bring the five million unemployed that David Blanchflower believed possible.  The Government has to keep shouting about our employment rates because people have got used to them.  A generation is growing up that cannot remember the mass unemployment of the 1980s.

Then there are a battery of announcements aimed disproportionately at younger women voters, who were more likely to switch to Labour at the last election.  Those of a certain disposition will argue that some of these are trivial, and that women and men both want government to get on with addressing big issues: Brexit, health, the economy, immigration, education and so on.  But part of the point of banning upskirting, say, or providing more free sanitary products is gaining “permission to be heard”, in order to make some voters, in this case younger female ones, more receptive to what Conservatives are doing more broadly and widely.

Which takes us, third, to law-making – not admitttedly the only means, or even necessarily the main one, by which government can act, but indispensable none the less.  Under which category we find a new law to protect service animals and the proposed end to no fault evictions, about which James Brokenshire wrote on this site recently.  The two may seem to have nothing in common but, on closer inspection, tell part of the same story.

Namely that, as Sam Coates keeps pointing out, the Government can’t get any plan which is remotely contentious through the Commons.  Only the most uncontested ideas, such as providing police and other service dogs with more protections, can make it through the House. And this new service animals measure isn’t even Government leglislation.  It came about through a Private Members Bill tabled by Oliver Heald and then backed by Ministers.

Meanwhile, the proposal to end no fault evictions isn’t contained in a Bill at all.  The headline on gov.uk about the plan refers to an “end to unfair evictions” and “the biggest change to the private rental sector for a generation”.  But the text of the announcement refers to “plans to consult on new legislation” and refers to an earlier consultation, on Overcoming the barriers to longer tenancies in the private rented sector, to which it has now published a response.

As with housing, so with divorce.  On ConservativeHome today, Frank Young makes the point, in his article on the Government’s plans to ensure that no fault divorce can take place more frequently, that “it remains to be seen if the Justice Department’s enthusiasm for new legislation will be matched by government business managers and the ability of the current government to get any legislation through”.  For David Gauke has unfurled not a new Bill, but a White Paper.

Ditto Liz Truss’s announcment on a £95,000 cap on exit payments when public sector workers leave their jobs. “Six-figure taxpayer-funded public sector exit payments to end,” gov.uk’s headline declares.  The sub-heading is more candid than the one beneath the housing headline.  “A consultation has been launched outlining how the government will introduce a £95,000 cap to stop huge exit payments when public sector workers leave their jobs,” it says.  The Treasury confirms that legislation will be required.

Now think on.  As Sam goes on to say, Theresa May’s successor may take against these ideas or indeed all of them.  In which case, they will doubtless be quietly put to sleep.  And that successor may be in place soon.  (Regretfully, we have to add: as soon as possible after European Parliament elections, assuming these happen, please.)

Conservative MPs don’t want a general election.  Nor do we.  But the more one ponders the state of this Parliament, the more one sees why one is the natural solution to this impasse – and would be knocking on the door, were it not for the Fixed Terms Parliament Act.  These recent announcements are Potemkin Legislation.  They cannot be put to the Commons without risk of them being amended out of their original intention.

Nor can the Government legislate easily elsewhere.  Consider any proposals affecting women – to take us back to near where we started.  Up would pop Stella Creasy, looking for a means of changing the abortion laws in Northern Ireland.  Which would further strain the Conservatives’ relationship with the DUP, such as it is.  Prepare, when Brexit isn’t before the Commons, for many more Opposition Days.

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com 

Potemkin legislation

Westlake Legal Group Screen-Shot-2019-04-17-at-07.25.35 Potemkin legislation Work Women and equality Women wages Treasury ToryDiary Stella Creasy MP sport Sam Coates (The Times) Sajid Javid MP rent Public Sector Northern Ireland NHS Local government and local elections Local Elections (general) Liz Truss MP Julian Assange jobs James Brokenshire MP immigration housing Home and family Highlights healthcare Health football Family and relationships exports employment Elizabeth Truss MP Economy DUP divorce disability Diane Abbott MP David Gauke MP David Blanchflower Conservatives Abortion

The ten most recent subjects covered by the Conservative Party’s Twitter feed are as follows: record employment, the provision of free sanitary products in primary schools, Conservative councils recycling more than Labour ones, more statistics about work and wages, record women’s employment, workers’ rights, an exports increase, more disabled people in employment, an end to no fault evictions, Conservative councils fixing more potholes than Labour ones, banning upskirting, funding more toilets at motorway service areas to help people living with complex disabilities, Sajid Javid criticising Diane Abbott over Julian Assange, kicking out racism in football, and a new law to protect service animals.

One might pick out three main themes, local election campaigning aside.

The first is the vibrancy of Britain’s jobs market and the country’s robust recent record on employment.  The aftermath of the Crash and the Coalition’s slowing of public spending growth, a.k.aa “austerity”, didn’t bring the five million unemployed that David Blanchflower believed possible.  The Government has to keep shouting about our employment rates because people have got used to them.  A generation is growing up that cannot remember the mass unemployment of the 1980s.

Then there are a battery of announcements aimed disproportionately at younger women voters, who were more likely to switch to Labour at the last election.  Those of a certain disposition will argue that some of these are trivial, and that women and men both want government to get on with addressing big issues: Brexit, health, the economy, immigration, education and so on.  But part of the point of banning upskirting, say, or providing more free sanitary products is gaining “permission to be heard”, in order to make some voters, in this case younger female ones, more receptive to what Conservatives are doing more broadly and widely.

Which takes us, third, to law-making – not admitttedly the only means, or even necessarily the main one, by which government can act, but indispensable none the less.  Under which category we find a new law to protect service animals and the proposed end to no fault evictions, about which James Brokenshire wrote on this site recently.  The two may seem to have nothing in common but, on closer inspection, tell part of the same story.

Namely that, as Sam Coates keeps pointing out, the Government can’t get any plan which is remotely contentious through the Commons.  Only the most uncontested ideas, such as providing police and other service dogs with more protections, can make it through the House. And this new service animals measure isn’t even Government leglislation.  It came about through a Private Members Bill tabled by Oliver Heald and then backed by Ministers.

Meanwhile, the proposal to end no fault evictions isn’t contained in a Bill at all.  The headline on gov.uk about the plan refers to an “end to unfair evictions” and “the biggest change to the private rental sector for a generation”.  But the text of the announcement refers to “plans to consult on new legislation” and refers to an earlier consultation, on Overcoming the barriers to longer tenancies in the private rented sector, to which it has now published a response.

As with housing, so with divorce.  On ConservativeHome today, Frank Young makes the point, in his article on the Government’s plans to ensure that no fault divorce can take place more frequently, that “it remains to be seen if the Justice Department’s enthusiasm for new legislation will be matched by government business managers and the ability of the current government to get any legislation through”.  For David Gauke has unfurled not a new Bill, but a White Paper.

Ditto Liz Truss’s announcment on a £95,000 cap on exit payments when public sector workers leave their jobs. “Six-figure taxpayer-funded public sector exit payments to end,” gov.uk’s headline declares.  The sub-heading is more candid than the one beneath the housing headline.  “A consultation has been launched outlining how the government will introduce a £95,000 cap to stop huge exit payments when public sector workers leave their jobs,” it says.  The Treasury confirms that legislation will be required.

Now think on.  As Sam goes on to say, Theresa May’s successor may take against these ideas or indeed all of them.  In which case, they will doubtless be quietly put to sleep.  And that successor may be in place soon.  (Regretfully, we have to add: as soon as possible after European Parliament elections, assuming these happen, please.)

Conservative MPs don’t want a general election.  Nor do we.  But the more one ponders the state of this Parliament, the more one sees why one is the natural solution to this impasse – and would be knocking on the door, were it not for the Fixed Terms Parliament Act.  These recent announcements are Potemkin Legislation.  They cannot be put to the Commons without risk of them being amended out of their original intention.

Nor can the Government legislate easily elsewhere.  Consider any proposals affecting women – to take us back to near where we started.  Up would pop Stella Creasy, looking for a means of changing the abortion laws in Northern Ireland.  Which would further strain the Conservatives’ relationship with the DUP, such as it is.  Prepare, when Brexit isn’t before the Commons, for many more Opposition Days.

Real Estate, and Personal Injury Lawyers. Contact us at: https://westlakelegal.com