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Why The Economy Is Soft Again

The gross lack of leadership and confidence in government is hobbling economic grwoth

By Joel Ross | Updated on April 05, 2015

Now the data is clear that the economy is slowing again and it is not just the weather. It is a combination of that and oil, the dollar, the port strike, and in my view, the real reason, which is a sense of foreboding permeating many decisions of companies. It is like a fog –you are driving and can see ahead, but not far ahead. You are headed to the beach and hope for sun, but as you drive it gets foggier. You keep driving in hope for a great day at the beach, but the more you drive the more uncertain you are that the sun will shine. That is where most people are today. Nobody can see where we are going. Jobs remain weak despite a good year in 2014. U6 is still at 10.9%, housing remains weal relatively, factory orders remain growing but slowly, and the dollar keeps rising. Wages are stagnant. A recent poll showed that 55% are fearful of another economic slowdown. I have a theory that so many people were shell shocked by the crash and now they are afraid to do anything but pay down debt and save.  All you need to see is that the gas savings went to those two things and not spending. This generation is doing the same as my parents generation who lived through the last depression.  Turning very conservative and fearful. Those people do not spend. Wages not going up are just proof to these people that times are not getting better. In fact on an inflation adjusted basis they are worse.

 

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