October 29, 2009

Obama's Commerce Department Proudly Announces Prelude to the Double-Dip Recession
— Ace

3.5% growth, beating analyst expectations, but Ed Morrissey pretty much nails it:

[W]hat we had in the third quarter was not long-term growth based on solid investment in business. We had a flurry of federal spending and consumer behavior predicated on highly temporary government interventions, like Cash for Clunkers and the homebuyer tax credit. That may be enough to make the administration look good for the next three months, but only for that long if they don’t stimulate real investment instead of using these gimmicky programs. If we have a double dip recession after these gimmicks end, Barack Obama won’t have George Bush to kick around any longer on the economy. He’ll own it after this.

If this is a genuine recovery, well, kudos to Obama for ignoring every principle of economics and sound fiscal policy and somehow contriving success.

But that seems unlikely. More likely is that this is a One Quarter Wonder. The enormous deficits Obama has created, and his general attitude of tax anything in sight, are going to continue to discourage non-government-gimmick investment, spending, and growth, and plunge us back into the next recession.

Meanwhile, at that link, job losses continue pretty much apace:

The number of people claiming jobless benefits for the first time dropped less than expected last week, evidence that the labor market remains weak even as the economy is recovering.

Also at Hot Air: Obama's already anemic "saved or created" nonsense jobs figure is even more nonsense than imagined.

An early progress report on President Barack Obama’s economic recovery plan overstates by thousands the number of jobs created or saved through the stimulus program, a mistake that White House officials promise will be corrected in future reports.

The government’s first accounting of jobs tied to the $787 billion stimulus program claimed more than 30,000 positions paid for with recovery money. But that figure is overstated by least 5,000 jobs, according to an Associated Press review of a sample of stimulus contracts.

The AP review found some counts were more than 10 times as high as the actual number of jobs; some jobs credited to the stimulus program were counted two and sometimes more than four times; and other jobs were credited to stimulus spending when none was produced.

Obama's fans, apparently, tried to do him a solid by claiming large numbers of jobs had been "saved or created," when in fact none, or very few, had been:

_ A company working with the Federal Communications Commission reported that stimulus money paid for 4,231 jobs, when about 1,000 were produced.

_ A Georgia community college reported creating 280 jobs with recovery money, but none was created from stimulus spending.

_ A Florida child care center said its stimulus money saved 129 jobs but used the money on raises for existing employees.

It is, of course, in the financial interests of "Stimulus" money recipients to claim all sorts of job growth -- they want Obama to keep sending them money, of course, and all Obama wants in return is for them to put numbers on a piece of paper that he can parade out to prove his drunken-sailor spending is "working."

So of course the Administration has no interest in vetting these numbers -- the higher the better, wink wink nudge nudge. Want to say that your small aromatherapy-for-convicts business expanded by thirty-three bazillion people thanks to Obama's spendulus? Awesome. Just write down large numbers on an unvetted, unverified report, and Obama will write down a large number on a check.

Posted by: Ace at 06:57 AM | Comments (72)
Post contains 607 words, total size 4 kb.

1 Heh, post is about a double-dip recession and the ads suddenly shift to people selling gold for investment.

Ya gotta love the internet...

Posted by: Nighthawk at October 29, 2009 07:02 AM (OtQXp)

2
If we have a double dip recession after these gimmicks end, Barack Obama won’t have George Bush to kick around any longer on the economy. He’ll own it after this.

I said this two weeks ago. There is definitely an upside to the positive spin the media and Obama are making on the economy. In time, as things get worse and worse, the People will blame Obama and the Democrats from taking a supposedly-recovering economy and making it worse.


Posted by: Tweet Allen Poe at October 29, 2009 07:03 AM (z37MR)

3

Cash for clunkers pricetag: $24,000 per car.

 

Awesome!

Posted by: Dave in Texas at October 29, 2009 07:03 AM (WvXvd)

4 I saw double-dip and thought of my balls.

But I was wrong.

Posted by: CUS at October 29, 2009 07:04 AM (wOGfT)

5 Let's see, the economy grows, but employment shrinks. Sounds like the rich are getting richer while the poor are getting poorer.

Posted by: fluffy at October 29, 2009 07:04 AM (4Kl5M)

6 He owns it now. The cheerleading team just hasn't got the memo yet.

Posted by: Roy at October 29, 2009 07:05 AM (cB77O)

7 Karl Denninger pretty much nuked this BS GDP number at Market Ticker (market-ticker.org).

Basically we spent about 1/4-trillion $$ to get about $100B in "growth".  Awesome.

Posted by: DocJ at October 29, 2009 07:05 AM (dt6br)

8 Yep, here she comes ... The Fascist FDR did it the same way, when the government money runs out, down she goes.

Posted by: bill-tb at October 29, 2009 07:06 AM (iiiMw)

9 It'll be even worse when they bring in a VAT to pay for health care.

Posted by: joncelli at October 29, 2009 07:06 AM (RD7QR)

10

Hmmmmm....

One Quarter Wonder in the 3rd quarter, right before election day?

May I be the first to question the timing?

Posted by: wiserbud at October 29, 2009 07:06 AM (y7qah)

11
Obama just pumped up the GDP on margin.

This is a recipe for Depression and NO ONE Wall Street or in Congress sees this?

Posted by: Tweet Allen Poe at October 29, 2009 07:08 AM (z37MR)

12
Basically we spent mortgaged about 1/4-trillion $$ to get about $100B in "growth". 

fixed


Posted by: Tweet Allen Poe at October 29, 2009 07:11 AM (z37MR)

13 more funemployment and starvfavetion!  awsome!

Posted by: The Butcher at October 29, 2009 07:11 AM (8g9qq)

14 People voting for Obama believing he was going to cut military spending ought to think again. Obama has dramatically increased military spending since he has become President. Check out the increases in the latest BEA GDP report:
 
Real federal government consumption expenditures and gross investment increased 7.9 percent in the third quarter, compared with an increase of 11.4 percent in the second. National defense increased 8.4 percent, compared with an increase of 14.0 percent.

Posted by: markytom at October 29, 2009 07:11 AM (S2usV)

15
Paul Krugman, super economic genius, sees nothing wrong with these policies?

What a fucking joke.

Posted by: Tweet Allen Poe at October 29, 2009 07:12 AM (z37MR)

16 Waiting for Bat Chain Puller to say "I told you so."

But, seriously, this is good news either way.  Not that I believe Obama has rewritten the laws of economics.  Without one positive quarter,  how would we have ever demonstrated the second part of a double dip recession, or the Obama recession as Dick Morris wants to call it.

Now, if we grow half a million jobs this month, we can worry, but I'm not yet.

Posted by: Methos at October 29, 2009 07:13 AM (IoxPW)

17 #10  Hmmmmm....

One Quarter Wonder in the 3rd quarter, right before election day?

May I be the first to question the timing?

Perhaps, but does it matter?  Obama isn't on the ballot.  I think it's more general state-run media cheerleading for Obama than a ploy to upset the off-year elections.  Is Deeds now going to win the VA governor's election because of the GDP news?  I highly doubt it.

 

Posted by: Kratos (on the back of Gaia, scaling Mt Olympus) at October 29, 2009 07:13 AM (9hSKh)

18

Why do I have this feeling that, as we are being driven off this cliff, the airbags ain't gonna deploy?

Posted by: Bill H at October 29, 2009 07:14 AM (q8CmE)

19 I'm selling everything so I can get a new house for nothing, wouldn't you? Hahahahahahaha!!

Posted by: 'Nam Grunt at October 29, 2009 07:16 AM (OXZNH)

20 Yes, Obama does own the coming economic downturn, but it will be very interesting to see the contortions that the media will go through to insulate him from any blame.  So who will the media blame?  Big Corporations?  lobbyists?  global warming?  Sarah Palin?

Ought to be fun to watch at least...

Posted by: Nighthawk at October 29, 2009 07:17 AM (OtQXp)

21
People are getting tired of this trend.

positive economic news: Obama's policies are working! Happy days are here again!

negative economic news: It's worse than we thought. It's gonna take more than a few months to fix the mess that eight years took to create.


Posted by: Tweet Allen Poe at October 29, 2009 07:18 AM (z37MR)

22 To paraphrase an accountant friend from Ernst&Young: "This shit is gonna go on for years and I have to puke now."

Posted by: MRI at October 29, 2009 07:20 AM (aVQo/)

23

So who will the media blame?

Fox News, of course. The root of every problem facing our country.

Posted by: Fred R. at October 29, 2009 07:20 AM (jRkV/)

24 That's a whole lot of bucks to "create" "25,000" jobs.  I'd take a salary of $31,480,000.00. 

Posted by: SJR2 at October 29, 2009 07:21 AM (iYx4l)

25 It is, of course, in the financial interests of "Stimulus" money recipients to claim all sorts of job growth -- they want Obama to keep sending them money, of course, and all Obama wants in return is for them to put numbers on a piece of paper that he can parade out to prove his drunken-sailor spending is "working."

Does our most tech saavy president in history have a web where you can submit numbers?  I want me some money.

Posted by: rockhead at October 29, 2009 07:22 AM (RykTt)

26
The chickens are coming home to roost.

Posted by: Keep ******* that chicken at October 29, 2009 07:24 AM (rYWEB)

27 If the "jobs, saved or created" numbers are bogus, how can I believe the 3Q GDP numbers?

Posted by: BackwardsBoy at October 29, 2009 07:27 AM (ZGhSv)

28 Hell I don't need weapons and boxes of ammo anymore odumbass IS truly the savior, house, healthcare and car for free! Wheeeeeeeeeeeeeeeeeeeeeeeee!! Oops no parachute.

Posted by: 'Nam Grunt at October 29, 2009 07:29 AM (OXZNH)

29

Ooh, Rush is playing a clip from Obama's press conference about his "phony GDP numbers". 

As per Rush:  "GDP is the sum of consumption of consumers, investment by business and spending of the government.  Was there any new consumption by consumers?  Investment by business?  No and No.  You only have increased government spending which is government borrowing.  These GDP numbers are phony."

Posted by: runningrn at October 29, 2009 07:31 AM (qP2BK)

30 All you naysayer racists were wrong there are unicorns shitting skittles, you've gotta believe in the savior, what a guy!

Posted by: 'Nam Grunt at October 29, 2009 07:33 AM (OXZNH)

31

I question the timing.  Hello, big elections next week in NY, NJ and VA.

Posted by: runningrn at October 29, 2009 07:36 AM (qP2BK)

32

Not only are these numbers inflated with temporary federal give-a-ways, but they are also fake. The people who issued these numbers essentially told everyone to not believe them because they were released based on incomplete numbers.

 

They will be revised AFTER the election.

Posted by: Vic at October 29, 2009 07:36 AM (CDUiN)

33 So corporate tax revenue is down 70-80% and we're supposed to believe 3.5% growth? F*ck these liars with the barbed cock of satan.

Posted by: Larsen E. Whipsnade at October 29, 2009 07:37 AM (6BgmB)

34 Stagflation here we come! Stocks are up you say? In nominal dollars, that makes sense. The currency is being devalued almost daily.

Posted by: Curmudgeon at October 29, 2009 07:37 AM (ujg0T)

35 I'm selling my '08 Dodge Ram too and buying a tricycle w/little red wagon attached, same, same, and you folks didn't believe in the won, gosh life is good! ...............Meanwhile our Brave Troops are dying and this bastard makes a photo op at Dover, beyond communist!! Shame on you odumbass!!!

Posted by: 'Nam Grunt at October 29, 2009 07:39 AM (OXZNH)

36 Now Rush is playing clips of Teh Bamster lying to small business owners. 

Posted by: runningrn at October 29, 2009 07:42 AM (qP2BK)

37 Obama has saved us all!  You Wingnuts are just jealous!

Posted by: Your Liberal Media at October 29, 2009 07:44 AM (1Y3Fy)

38 The comment sections at Market Ticker, Zerohedge, and Calculated Risk are beating the GDP numbers like a red-headed stepchild.  Given the economic metrics that are being cited at these places, it's pretty obvious that the numbers got massaged to wake up Kermit in the stock market, since Elmo's been running rampant on Wall Street the last couple of days.

Posted by: David Axelrod's Combover at October 29, 2009 07:44 AM (/Pw+r)

39 This admin. are nothing but lying racists that want the "good folks" to suffer as much pain as they can bestow on them, wake up America!

Posted by: 'Nam Grunt at October 29, 2009 07:45 AM (OXZNH)

40 I love how you now offer careful caveats about this chimerical recovery, but for eight years on your knees waiting for Bush's money shot, the economy was great for workers.

Bush=0 job growth.

Eight fucking years.

Posted by: Kurt Wicksell at October 29, 2009 07:47 AM (HUSdz)

41

People are getting tired of this trend.

positive economic news: Obama's policies are working! Happy days are here again!

To be fair, Larry Kudlow was crowing like a rooster about the GDP numbers.  CNBC has basically become a Permabull network at this point; they'll do anything to promote an economic recovery that realistically doesn't even exist right now.

Posted by: David Axelrod's Combover at October 29, 2009 07:48 AM (/Pw+r)

42 Here is a question. During Carters administration in 2 years he increased the money supply by 13%. It took 20% interest rates to return the money supply to normal. In last than 1 year the money supply has increased 120%. What will be the interest rate to fix this over supply? We're screwed...

Posted by: da prez at October 29, 2009 07:52 AM (7t+Ws)

43 Barry has the economy well on the way to becoming more and more like Zimbabwe.

Posted by: TheQuietman at October 29, 2009 07:56 AM (1Jaio)

44 3.5% growth created by outrageous spending to political cronies is the change I've been waiting for!

Posted by: Obama Voter at October 29, 2009 07:56 AM (xtgND)

45

"If we have a double dip recession after these gimmicks end, Barack Obama won’t have George Bush to kick around any longer on the economy. He’ll own it after this."

Oh, please....gimme' a break. I'm sure that's exactly how it'll play out in the legacy media.

Posted by: genghis at October 29, 2009 07:56 AM (1XErj)

46 Mallamutt, I hope he brings better material than some of the others.

Posted by: wrg at October 29, 2009 07:56 AM (7t+Ws)

47 Big Bucks! Big Bucks! No whammies, no whammies!! And... STOP!!!

Posted by: The Fed at October 29, 2009 07:58 AM (xtgND)

48

I love how you now offer careful caveats about this chimerical recovery, but for eight years on your knees waiting for Bush's money shot, the economy was great for workers.

Bush=0 job growth.

Eight fucking years.

Considering Obama's record so far is -6 million job growth, 0 job growth doesn't look too bad right now. 

Snark aside, ultimately it's irrelevant--the last two major periods of economic growth, 1994-2000 and 2003-2007, were nothing more than bubbles that couldn't be sustained.  Republicans and Democrats were in charge during this period, and Republicans and Democrats were the ones who caused this mess.  And what is the current President and Congress doing?  More of the same.  Maybe you should be asking yourself why Barney Frank has been sitting his fat ass on HR 1207 since February, even though it now has more than enough co-sponsors to pass if released from committee for a vote, and the administration is doing nothing of substance to either tighten regulations on the financial industry or even enforce the ones already in place.  Instead, "C4HomeClunkers" will be extended and GMAC will get another $8 billion of Chinese-owed debt.  The U3 and U6 are through the roof, which shows the stimulus was an utter failure at doing what it was promoted to do.  Nice example of "change" there.

Posted by: David Axelrod's Combover at October 29, 2009 07:59 AM (/Pw+r)

49 5 Let's see, the economy grows, but employment shrinks. Sounds like the rich are getting richer while the poor are getting poorer.

Actually, the meme we need to push is the same one they used during the Bush admin: "Good for Wall Street, but not good for Main Street".  That chicken needs to come home to roost.

Posted by: Lone Marauder at October 29, 2009 07:59 AM (/bVuS)

50

46

Uh, Thats about 184%

Seems like a doable rate, lets see a mortgage on a $100,000 house would have a  P&I payment of $12,267/month with 20% down and a 30 year loan

Posted by: VELVET AMBITION at October 29, 2009 08:00 AM (xLMtq)

51 David Axelrod's Combover

Finally, somebody here with brains.

Posted by: Kurt Wicksell at October 29, 2009 08:04 AM (HUSdz)

52

41 Obama has saved us all!  You Wingnuts are just jealous!

The best president since FDR!

Posted by: Bob Beckel at October 29, 2009 08:06 AM (wAQA5)

53

Posted by: Kurt Wicksell at October 29, 2009 01:04 PM (HUSdz)

Thank you for tacitly admitting that the administration and Congress are continuing the usual "extend and pretend" economic policies and that "change" was just a campaign slogan.

Posted by: David Axelrod's Combover at October 29, 2009 08:06 AM (/Pw+r)

54 Don't look at me I HATE the attention !

Posted by: Kert Wicksell at October 29, 2009 08:06 AM (5iQTe)

55 Typically, it takes about two years for people to realize that the money we have been printing isn’t real but simply “magic money”.  We are currently about one year into that two year grace period, and the smart money is buying up hard assets like gold, knowing that it isn’t paper and is the only form of money that isn’t simultaneously someone else’s liability.

This is simply the calm before the storm.  Those Trillions of dollars are like little hurricane seeds beginning to swirl off the coast, gaining speed and force until they mature into the monetary equivalent of Hurricane Katrina.

Posted by: wrg at October 29, 2009 08:10 AM (7t+Ws)

56

Sometimes I have honestly thought about doing a sockpuppet called Mallamutt's Evil Liberal Brother just to make a coehsive liberal argument for amusement.

Even absent the "mallamut" moniker in the handle, we'd know you were a sock.  The thing being liberals aren't usually able to make a "cohesive liberal arguement".  I submit to you exhibit A:  Mr. Proggressive (aka Mr. Pink)  The thing that really sunk him was his correct syntax, and the dearth of spelling and grammatical errors. 

Posted by: runningrn at October 29, 2009 08:11 AM (qP2BK)

57

Posted by: genghis at October 29, 2009 12:56 PM (1XErj)

Ooh, Genghis is in the house!  Quick, someone go get ParanoidGirlInSeattle!

Posted by: runningrn at October 29, 2009 08:12 AM (qP2BK)

58 Once this inflationary cycle starts, foreigners (China) will realize that their investments in T-bills are depreciating rapidly.  There will be a massive exodus that will put more pressure on the dollar and on interest rates.  Our weakened US economy will be faced with the rising cost of capital and a painful period of stagflation.  Trillions of dollars will have been wasted.  Our government will have mortgaged America and the ensuing debt will have to be paid by future generations.

Posted by: wrg at October 29, 2009 08:17 AM (7t+Ws)

59

There's no evidence the White House sought to inflate job numbers in the report. But administration officials seized on the 30,000 figure as evidence that the stimulus program was on its way toward fulfilling the president's promise of creating or saving 3.5 million jobs by the end of next year.

The reporting problem could be magnified Friday when a much larger round of reports is expected to show hundreds of thousands of jobs repairing public housing, building schools, repaving highways and keeping teachers on local payrolls.

The White House says it is aware there are problems. In an interview, Ed DeSeve, an Obama adviser helping to oversee the stimulus program, said agencies have been working with businesses that received the money to correct mistakes. Other errors discovered by the public also will be corrected, he said.

"If there's an error that was made, let's get it fixed," DeSeve said.

Heh!  Rush just pointed out that an official overseeing the Stimulus has a last name that is probably pronounced "Deceive."

Posted by: runningrn at October 29, 2009 08:19 AM (qP2BK)

60 @ 56 Sometimes I have honestly thought about doing a sockpuppet called Mallamutt's Evil Liberal Brother just to make a cohesive liberal argument for amusement.

Is there such a thing?

Posted by: Curly Mustard at October 29, 2009 08:20 AM (sOpAl)

61  Regarding the "3.5% growth from the Bureau of Economic Analysis:
 
 The Bureau emphasized that the third-quarter advance estimate released today is based on source
data that are incomplete or subject to further revision by the source agency
 

Posted by: Mike W at October 29, 2009 08:20 AM (7QO3K)

62 The only growth trend at this point is in government bailouts, which are in high gear, indicating we’ll experience the serious growth of outstanding debt. The elevated levels of government borrowing required to fund that spending are absorbing all available credit from foreigners, directly competing with business in need of the new financing that will be required to expand the economy. The combination of declining business activity, coupled with declining levels of household income, will result in declining tax revenues, increasing the budget deficit beyond the size of the new bailout programs. State and municipal governments across the nation are already being confronted with large shortfalls in their budgets, shortfalls that will only widen as the crisis worsens.

The combined business slowing and jobs contraction assure that the GDP will decline. Components of GDP having to do with necessities like food and shelter will continue to bump along regardless of the economic conditions, but the lack of growth in GDP could extend for years as it did in Japan and as it did after the 1929 stock crash.

Posted by: wrg at October 29, 2009 08:22 AM (7t+Ws)

63 As others have mentioned, your lead-pipe lock of the week is that these numbers will be quietly, very quietly revised down to about 0 or less in a month. And not one of the jackasses crowing today will dare mention the revision. And they'll post a phony inflated number of 1 to 2% GDP growth at the end of the year and every one of the cocksuckers will blow out their vocal cords telling us about the "two straight quarters of growth!" When one has been revised to at or near zero and entirely based upon government spending and the next will be revised later to negative.

There is a very concerted and sophisticated effort, a conglomeration of government officials and money brokers who are orchestrating all of this: From the phony crisis last September to now. The whole point being to suck the hard, real money that ordinary Americans have into the pretend money cesspool of Wall Street to cover their losses. What they are doing, the levels of crime and fraud they are engaged in, the risks they are so openly taking--with the support, encouragement and help of the regulatory bodies--ought to scare the shit out of everyone because it means things are even worse than the worst case scenarios.

There are going to be riots . . . .

Posted by: jimmuy at October 29, 2009 08:25 AM (EzcbY)

64

From John Williams

Recession Is Not Over

Quarterly GDP Growth Is Not Sustainable
With 92% of Growth in Nonrecurring Factors

Annual GDP Down 2.3% (5.7% SGS)

4th-Quarter GDP Should Resume
Quarter-to-Quarter Decline

Durables Goods Orders at 1997 Level

Help-Wanted Adverting at New 58-Year Low

Posted by: VELVET AMBITION at October 29, 2009 08:26 AM (xLMtq)

65

Be extremely skeptical when you hear some pundit pronouncing that this piece of short-term good news or another is an “all clear” signal. Until we start seeing a systematic improvement in the economic fundamentals – for example, an upward movement in consumer confidence – the only signal the economy will be hearing is that of a runaway train coming straight at it.

Posted by: wrg at October 29, 2009 08:28 AM (7t+Ws)

66 I told the Feds if they would slip me a few millions, I promised to create 200 jobs. I plan to buy beer at 200 different places with the money they gave me. Really, I will. Say, that's a really nice business you got going on there. Would be a terrible shame if something...bad happened to it. Fire. Break in. Identity theft. Yeah, a real shame. I can offer you some insurance...

Posted by: I R A Darth Aggie at October 29, 2009 08:29 AM (1hM1d)

67 More likely is that this is a One Quarter Wonder.

I hope not. I hope everything I know about economics is wrong and the economy turns around. I hope that everything is peachy next year. I just can't see how and I fear the worst.

Posted by: Christopher Taylor at October 29, 2009 09:37 AM (PQY7w)

68

I was over at the hospital pharmacy picking up, and CNN was on. Their little on-air bimbo was cooing that "this was a sign that our longest recession since the Great Depression might finally be over".

Fucking idiots. I'm putting what I've got into canned food and ammo.

Posted by: SGT Dan at October 29, 2009 12:05 PM (GgXZc)

69

@71: There are a decent number of help-wanted signs up in my areas (Santa Monica, CA).  They aren't for top-shelf jobs, but there are a number of people hiring, and it doesn't look to be just for seasonal workers.

Still, the people looking for new help are badly outnumbered by the empty places. 

Posted by: Fa Cube Itches at October 29, 2009 01:55 PM (vupGF)

70 It's all about matching tiffany co jewelry , and creating the best combination of colors for one's general dressing. It will help to buy what you need simpler, and you will be pleased that you just added some Tiffany diamond jewelry in your present rings selection.

Posted by: herman198 at March 10, 2011 01:11 AM (tnRWG)

71 Men and women when diamond, important stones, gold and platinum had been a common metals to discover the model of tiffany. They are funky, wise indeed secure in these imitation tiffany jewelry

Posted by: herman198 at March 14, 2011 09:19 PM (bUUy/)

72 Well done, thak you for your great posts, i learned more from here.

Posted by: ipod to mac at April 14, 2011 07:20 AM (ecKmC)

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