US economy: let us pray
By the end of last year we were certain that if America wasn’t already in recession it was getting pretty close. Nothing has happened since to change our minds.
Instead, the news out of the US is just getting worse. House prices are still falling fast. Consumers feel worse today than they have at any point since the early 1990s (with the exception of a brief period around the start of the Iraq war).
The financial sector isn’t getting itself out of trouble in a hurry either. The write-offs continue and, in a nasty little sign of the times, The Wall Street Journal reports the Federal Deposit Insurance Corporation is looking to bring 25 retirees from its division of resolution and receiverships back to work in an attempt to prepare for a rise in the number of failing financial institutions.
Then there is inflation: the US producer price index (PPI) was up 7.4% year on year in January – that’s its biggest leap since 1981. And the dollar, still tanking due to the fact that the Fed has very little left in the way of inflation-fighting credibility.
There is no good news here.
Read the full editor’s letter here: US economy: let us pray