Manufacturing sector shrinks for first time in three years

posted at 10:01 am on July 3, 2012 by Ed Morrissey

Even though this week will have most Americans distracted from the news while celebrating Independence Day with families and friends, that doesn’t mean that there won’t be important news this week.  On Friday, we’ll get the jobs report from June, which so far doesn’t look promising, as well as a precursor report from ADP on private-sector job growth, as well as other economic indicators for the previous period.  Yesterday, one of the biggest came out — and it was bad news for the US economy.  Manufacturing “plummeted,” Reuters reported, according to the composite index from the Institute of Supply Management:

U.S. manufacturing shrank in June for the first time in nearly three years as new orders plummeted, according to one measure of the sector that provided a stark sign of the economic recovery’s slowdown.

The Institute for Supply Management said on Monday its index of national factory activity fell to 49.7 from 53.5 the month before, missing expectations of 52.0, according to a Reuters poll of economists, and below even the lowest forecast.

It was the first time since July 2009 that the index has fallen below the 50 mark that separates expansion from contraction. That was shortly after the U.S. economy emerged from recession.

The Associated Press analysis says to expect Q2 to come in even weaker than Q1′s stagnation-level 1.9% GDP growth, although perhaps not yet a recession-level number:

Economists said the manufacturing figures were consistent with growth at an annual rate of 1.5 percent or less. That would be down from the January-March quarter’s already tepid annual pace of 1.9 percent.

“Our forecast that the U.S. will grow by around 2 percent this year is now looking a bit optimistic,” said Paul Dales, an economist at Capital Economics. …

Most economists aren’t yet predicting another recession. Though the ISM report suggests manufacturing is contracting, it typically takes a sustained reading below 43 to signal the economy isn’t growing.

Still, U.S. manufacturing, which has helped drive growth since the recession ended, is faltering at a precarious time.

Jim Pethokoukis isn’t as optimistic:

But these numbers are just the latest in a long string of worrisome reports including rising initial unemployment claims, slowing job growth, falling consumer confidence, and declining durable goods orders. Oh, and the rest of the global economy is slowing, too.

The rule-of-thumb recession indicator is back-to-back-quarters of negative GDP growth. But the National Bureau of Economic Research, the group that makes the “official” recession call, uses a broader and more nuanced approach:

It examines and compares the behavior of various measures of broad activity: real GDP measured on the product and income sides, economy-wide employment, and real income. The Committee also may consider indicators that do not cover the entire economy, such as real sales and the Federal Reserve’s index of industrial production (IP). The Committee’s use of these indicators in conjunction with the broad measures recognizes the issue of double-counting of sectors included in both those indicators and the broad measures. Still, a well-defined peak or trough in real sales or IP might help to determine the overall peak or trough dates, particularly if the economy-wide indicators are in conflict or do not have well-defined peaks or troughs.

It takes more than one bad report for a recession, of course, but this isn’t just an outlier of a result either.  Jim uses a 12-year graph of the ISM new orders index, and the trend has been significantly downward since the start of the recovery in mid-2009:

We’ve had a few good months in this series, but a trendline would show a slope downward, and the latest data point drops below anything seen in the early part of the recession in 2007.

What does this mean for the election?  Obviously, a tip-over into recession would be very damaging to Barack Obama’s re-election chances, but it may not take a full-fledged recession for that, either.  Nate Silver analyzed a host of economic indicators in relation to election results over the last 60-plus years, and determined that the ISM index is the most predictive — although still not a slam-dunk sign:

Meanwhile, the best-performing variable has been the ISM manufacturing index, which is a measure of how much manufacturing businesses are ramping up or ramping down their activity. It has had an r-squared of .46.

The manufacturing index has several things going for it. It is considered a fairly good leading indicator of economic activity in general and of jobs growth in particular, and it represents a composite score from five different component indicators, including things like the employment environment and new factory orders.

So does this mean you should all go out and use the ISM manufacturing index in your forecasting models? Actually, maybe not. It is certainly worth looking at. But when you’re testing 43 different economic indicators over a sample of just 16 elections, the best-performing ones are likely to have been a little lucky.

This outperforms changes in non-farm payrolls and changes in the unemployment rate, but only by just a small margin.  Unfortunately for Obama, neither of those are likely to show much improvement in the next four months, either.

Update: The news isn’t all bad, however:

New orders for manufactured goods in May, up following two consecutive monthly decreases, increased $3.3 billion or 0.7 percent to $469.0 billion, the U.S. Census Bureau reported today. This followed a 0.7 percent April decrease. Excluding transportation, new orders increased 0.4 percent. Shipments, up five of the last six months, increased $2.3 billion or 0.5 percent to $476.0 billion. This followed a 0.2 percent April decrease. Unfilled orders, down two consecutive months, decreased $0.4 billion to $984.4 billion. This followed a 0.1 percent April decrease. The unfilled orders-to-shipments ratio was 6.25, down from 6.33 in April. Inventories, also down two consecutive months, decreased $1.4 billion or 0.2 percent to $604.5 billion. The inventories-to-shipments ratio was 1.27, down from 1.28 in April.

Most of the bump came from the transportation sector.  Excluding transportation, orders increased 0.3%.


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The private sector is doing fine.

The Rogue Tomato on July 3, 2012 at 10:03 AM

Can’t wait to see Friday’s numbers…

PatriotRider on July 3, 2012 at 10:03 AM

I can’t tell you how badly it makes me feel to great every bit of of bad news with hope that it will be what makes the country see that Obama is a disaster. It’s very depressing.

Cindy Munford on July 3, 2012 at 10:04 AM

Spin away lsm

cmsinaz on July 3, 2012 at 10:06 AM

Uh, Reuters left out unexpectedly. Or did you leave that part out of Reuters report? That was unexpected.

cozmo on July 3, 2012 at 10:06 AM

The Excuse Manufacturing business is booming, just ask Obama.

NoDonkey on July 3, 2012 at 10:06 AM

“Yes, it’s still Bush’s fault.” Carney at the Friday press briefing after the numbers drop.

Nathan_OH on July 3, 2012 at 10:06 AM

Great post. I read it as:

ISM is a good indicator. But maybe not always. It’s a leading indicator. Should you use it? Maybe not. Will it hurt Obama? Maybe, maybe not.

Real hard stuff there.

The Rogue Tomato on July 3, 2012 at 10:07 AM

The trend is awful…we are approaching another cliff…

PatriotRider on July 3, 2012 at 10:07 AM

“Yes, it’s still Bush’s fault.” Carney at the Friday press briefing after the numbers drop.

Nathan_OH on July 3, 2012 at 10:06 AM

Nah, now it’s the Congressional Republicans’ fault for standing in the way of hiring more teachers, firefighters, and cops. Not sure how that helps the private sector(or our debt crisis), but whatever.

Doughboy on July 3, 2012 at 10:08 AM

If the press wants to encourage optimism, they should stop reporting those polls that say Obama is ahead of Romney.

RBMN on July 3, 2012 at 10:08 AM

Cindy you’re not alone

Paraphrase pelosi some folks had to vote for him to know what he is….

cmsinaz on July 3, 2012 at 10:09 AM

Taxmaobamacaretaxmageddon!

This is the final disaster that ends The Obama Regime.

We’re already in deep recession. Anyone looking can see it. How the hell could anyone invest in this economy with all those whirring blades overhead?

wildcat72 on July 3, 2012 at 10:10 AM

Don’t place that champagne order yet. All economy indicators will be fudged to slide down by mid-September so they could be reported as skyrocketing in October. All hail the New Messiah!

Archivarix on July 3, 2012 at 10:10 AM

The trend is awful…we are approaching another cliff…

PatriotRider on July 3, 2012 at 10:07 AM

And we have Evel Knievel Evil Kardashians in the White House.

Electrongod on July 3, 2012 at 10:11 AM

The Rogue Tomato on July 3, 2012 at 10:03 AM

President Obama will rue the day he made that comment.

BigGator5 on July 3, 2012 at 10:12 AM

The boy king’s regime, with the help of a fawning media, will “manufacture” some crisis to divert attention away from this news.

Flora Duh on July 3, 2012 at 10:13 AM

President Downgrade is setting the controls for the heart of the sun.

kirkill on July 3, 2012 at 10:14 AM

Great post. I spin read it as:

ISM is a good indicator. But maybe not always. It’s a leading indicator. Should you use it? Maybe not. Will it hurt Obama? Maybe, maybe not.

Real hard stuff there.

The Rogue Tomato on July 3, 2012 at 10:07 AM

Take it up with Reuters, the Bastion of Objectivity.

Akzed on July 3, 2012 at 10:14 AM

I’d like to see the portion of the ISM number that comes from swing states. I would have to think that the state-specific numbers in those states is even worse than the combined number.

TXUS on July 3, 2012 at 10:14 AM

But, Obeyme said we were supposed to Make Stuff and Sell Stuff.
The Manufacturing Sector better quit whinin’ and get to work, or something.

Dexter_Alarius on July 3, 2012 at 10:16 AM

Ed, you missed the punch line of the AP report:

The economy could also get a boost this summer from lower gas prices, which have tumbled more than 60 cents per gallon since peaking in April. The result is that consumers have more money to spend on other goods, from autos and furniture to electronics and vacations, that fuel economic growth.

Yep, the economy is going to be SAVED by falling gas prices. People who were getting hammered and letting other bills slide, now get a reprieve so they can buy that new car, that new flat screen TV and that long awaited vacation!

AP never thinks that just maybe gas prices are falling BECAUSE THE ECONOMY IS SLOWING.

GarandFan on July 3, 2012 at 10:16 AM

The Manufacturing Sector better quit whinin’ and get to work, or something.

Dexter_Alarius on July 3, 2012 at 10:16 AM

Or face a fine tax for inactivity.

Electrongod on July 3, 2012 at 10:17 AM

“Yes, it’s still Bush’s fault.” Carney at the Friday press briefing after the numbers drop.

Nathan_OH on July 3, 2012 at 10:06 AM

“I inherited a 1.4 Trillion deficit from Boosch!” – Zero
(Even though it was closer to 0.6 Trillion, and featured his final two years being a progressive with Pelosi and Reid)

Zero then immediately doubled that deficit, and blamed that on Boosch too.

kirkill on July 3, 2012 at 10:18 AM

The trend is awful…we are approaching another cliff…

PatriotRider on July 3, 2012 at 10:07 AM

I was going to say. If that graph were a stock, and I put the lines where they went, those lines would be a little hellish. :)

– zoom out, zoom out, zoom out

Axe on July 3, 2012 at 10:18 AM

“Our forecast that the U.S. will grow by around 2 percent this year is now looking a bit optimistic,” said Paul Dales, an economist at Capital Economics.

Is this a change from fudging the numbers up front and revising them downward later hoping no one will notice? I don’t think coming up with wildly great numbers in October is going to help Obama. I was going to say people aren’t stupid enough to buy that,especially when they don’t actually see any evidence of it, but, well, never mind.

Night Owl on July 3, 2012 at 10:19 AM

The Manufacturing Sector better quit whinin’ and get to work, or something.

Dexter_Alarius on July 3, 2012 at 10:16 AM

Or face a fine tax for inactivity.

Electrongod on July 3, 2012 at 10:17 AM

It won’t be long before lots and lots of inactivities are taxed.

Will the American People take it or will we see (metaphorically) IRS agent heads on pikes?

wildcat72 on July 3, 2012 at 10:20 AM

Great post. I read it as:

ISM is a good indicator. But maybe not always. It’s a leading indicator. Should you use it? Maybe not. Will it hurt Obama? Maybe, maybe not.

Real hard stuff there.

The Rogue Tomato on July 3, 2012 at 10:07 AM

More Milquetoast commentary from Ed and Co courtesy of Hot Gas.

DevilsPrinciple on July 3, 2012 at 10:20 AM

cmsinaz on July 3, 2012 at 10:09 AM

Thanks for even figuring out what I was trying to say. I get worse at proofreading everyday.

Cindy Munford on July 3, 2012 at 10:21 AM

Clearly it’s time for Congress to pass the “Equalization of Opportunity Bill” since this is a crisis too good to waste.

kirkill on July 3, 2012 at 10:23 AM

GarandFan on July 3, 2012 at 10:16 AM

LOL! I’ve noticed some really interesting math on the part of the MSM on the gas prices. You can’t use a calculator and hold pom poms at the same time.

Cindy Munford on July 3, 2012 at 10:23 AM

kirkill on July 3, 2012 at 10:23 AM

Please don’t give them any ideas.

Cindy Munford on July 3, 2012 at 10:23 AM

GarandFan on July 3, 2012 at 10:16 AM

No kidding, I enjoy watching Diane Sawyer breathlessly reporting every .01 cent drop in gas prices as if it means the economy is on the path to recovery. They just don’t get it.

And oh yeah, I’m going to spend that extra $20 a month the lower prices gets me on a new car or a new living room set….makes sense.

HumpBot Salvation on July 3, 2012 at 10:23 AM

A lot being made of this report, but if anything it is indicative of the global slowdown and its impact on our manufacturing here. On the same day this was announced, construction spending came in almost 3 times better than expected, and today factory orders for May came in at a stronger than expected +0.7%. Auto makers are also reporting strong numbers today, we had a good durable goods report for May, and the housing numbers from the last couple of weeks looked strong as well. Seems to fit with the picture that while the rest of the world is slowing (exports, manufacturing down), locally we are buying (housing, autos, durable goods). The ISM non-manufacturing index report on Thursday will be interesting, and may be an early read on the jobs report coming Friday. Expectations are low, and the markets seem poised for another rally … fasten your seatbelts.

TouchdownBuddha on July 3, 2012 at 10:24 AM

Boy, it’s a good thing we had that stimulus, eh? Progress!

tdpwells on July 3, 2012 at 10:25 AM

Cindy we are cool :)

cmsinaz on July 3, 2012 at 10:25 AM

And oh yeah, I’m going to spend that extra $20 a month the lower prices gets me on a new car or a new living room set….makes sense.

HumpBot Salvation on July 3, 2012 at 10:23 AM

It’ll go towards an extra oil change with all that driving you’ll be able to afford now. ;)

tdpwells on July 3, 2012 at 10:26 AM

AP never thinks that just maybe gas prices are falling BECAUSE THE ECONOMY IS SLOWING.

GarandFan on July 3, 2012 at 10:16 AM

Except that analysts have already identified that lower gas prices are due to slowdown of Chinese demand. Yes that matters for our economy, but (as has been said again and again) U.S. supply and demand doesn’t control oil prices.

libfreeordie on July 3, 2012 at 10:27 AM

Good job including the update from the Obama admin… for May. Too bad we are in July. We shall see what June’s report looks like in August based on the CURRENT ISM numbers.

kevinkristy on July 3, 2012 at 10:28 AM

U.S. manufacturing is down because inventories are up because consumer spending is down because the monthly cost of living is up.

Businesses have been riding on this merry-go-round for three years while Obama continues his methodical assault on the private sector. Meanwhile, the mostly public sector infusion of Obama’s porkulas has dried up, leaving a void in the purchasing power.

The bottom line is a slowdown in manufacturing will continue through the rest of the year. The only reason fuel prices are down is because there is no demand—no one can afford to fill their tanks and still feed their families. Summer vacations will be shorter or cancelled, leaving the tourist industry hurting. But, as others have said above…….

The Private Sector is Doing Fine!

Rovin on July 3, 2012 at 10:29 AM

AP never thinks that just maybe gas prices are falling BECAUSE THE ECONOMY IS SLOWING.

GarandFan on July 3, 2012 at 10:16 AM

AP never thinks that maybe, just maybe, gas prices are falling because people aren’t buying it … because they’re running out of money. When you’re running out of money, money isn’t being “saved”, it means that other purchases won’t also be cut as much … right now.

Dusty on July 3, 2012 at 10:30 AM

How many times from 2000 to 2004 did we hear the term “Jobless Recovery” from the media?

jaime on July 3, 2012 at 10:31 AM

And the great plan coming from democrats…..

….Obamacare which will increase medical cost….increase taxes on the working class by the billions….increase costs to employer’s which will decrease jobs…..

………increase energy costs by following the wishes of the enviro-lobbyist,whose initiatives have killed tens of thousands of jobs and counting.

….increase our National debt and deficits by the trillions….

Attack and demonize the successive people in this country (except when there giving money to Obama) with class warfare and massive over regulation.

…..going after Slurpee’s,Salt,and Happy Meals while our economy continues to stagnate.

…..supporting the Jihadist power grab that will see radical islam more powerful now than at anytime in modern History.

…..but liberals will ignore this reality and yell “we’re headed in the right direction”……..
………………………nothing but cultist in the People’s Temple of Obama.

Baxter Greene on July 3, 2012 at 10:32 AM

After reading numerous articles and posts on here, I have come to the conclusion that 99% have no clue about manufacturing.

Since 2008 (a horrible year for manufacturers in the U.S.) companies have had record profits for consecutive years, as least my customers in the manufacturing sector. They have wanted and NEEDED to expand facilities, and already have drawn up basic design parameters to do so, with logistics and markets for their goods in place with demand still strong.

There has been one problem which occurred in Nov. 2006, the Dems have held congress, but since Nov. 2010 it is just the Senate and regulatory agencies, which can block anything and everything.

The problem is that if they build to meet demand (and displace goods supplied by China et al) they may not be able to use the new facilities due regulations by OSHA and EPA, or may not be able to have adequate feedstock for their manufacturing processes.

This can be compared to someone building an addition to their home or even a second home, and not being able to use it or sell it. Wasted money, don’t you think.

For those unaware, 2000/2001 (until the Bush tax cuts) was horrible for manufacturing. Manufacturing, especially the plastics sector, had shutdown all over the nation in 1998 through 2000 and flooded the market with re-usable manufacturing equipment. Profit margins were gone if not negative. Thank Clinton and some of the change in tax code by the Newtron led House for that.

Kermit on July 3, 2012 at 10:32 AM

The nation wasn’t supposed to collapse this soon, the Destructionists in the WH were planning for 2013 or’14. Just goes to show managing, or even destroying an economy isn’t easy.

arand on July 3, 2012 at 10:35 AM

The private sector is doing fine.

The Rogue Tomato on July 3, 2012 at 10:03 AM

I’ve gotta wonder who he was trying to convince: the voters… or himself?

Mr. Prodigy on July 3, 2012 at 10:37 AM

You can’t use a calculator and hold pom poms at the same time.

Cindy Munford on July 3, 2012 at 10:23 AM

Excellent!

Sue Doenim on July 3, 2012 at 10:43 AM

If memory serves, GDP is a combination of private AND government monies. Private industry has been tanking, but the GDP has been artificially propped up by the grotesque increase in federal spending. We are already in a recession, but the vast amount of money being poured out by the government is masking it. Until sometime after November 6, I’d say.

Physics Geek on July 3, 2012 at 10:46 AM

You can’t use a calculator and hold pom poms at the same time.

Cindy Munford on July 3, 2012 at 10:23 AM

Excellent!

Sue Doenim on July 3, 2012 at 10:43 AM

That is some of Munford’s best work. :)

Axe on July 3, 2012 at 10:47 AM

Give Barry four more years and he will guarantee that we will construct more and better excuses for failure (with new and improved blame!).

NoDonkey on July 3, 2012 at 10:48 AM

BREAKING: TV Legend Andy Griffith Dead at 86

Flora Duh on July 3, 2012 at 10:50 AM

Rest in Peace, Sheriff.

hawkdriver on July 3, 2012 at 10:57 AM

BREAKING: OUR PRESIDENT IS A SCOAMF!

GhoulAid on July 3, 2012 at 10:57 AM

BREAKING: TV Legend Andy Griffith Dead at 86

Flora Duh on July 3, 2012 at 10:50 AM

Still one of my favorite shows. Andy Taylor always reminded me of my grandfather, who was always the same kind of upstanding gentleman his character was.

wildcat72 on July 3, 2012 at 11:00 AM

Jimmuh Carter and Obama are proof that you must hit bottom before rising again

Bevan on July 3, 2012 at 11:01 AM

The Adults are in charge.

Del Dolemonte on July 3, 2012 at 11:02 AM

Somebody’s gotta post it:

Thank you President Obama-cccp6

Dr. Carlo Lombardi on July 3, 2012 at 11:02 AM

CM ,
Pom poms and calculator ?
Brilliant mam !

Lucano on July 3, 2012 at 11:02 AM

If we could only manufacture brain cells…

hillsoftx on July 3, 2012 at 11:04 AM

BREAKING: TV Legend Andy Griffith Dead at 86

Flora Duh on July 3, 2012 at 10:50 AM

Obamacare’s biggest supporter too. I put it to senility, but RIP in any case.

slickwillie2001 on July 3, 2012 at 11:06 AM

AP never thinks that just maybe gas prices are falling BECAUSE THE ECONOMY IS SLOWING.

GarandFan on July 3, 2012 at 10:16 AM

This makes me think of credit card debt issues. Whenever the lsm reports cc debt is up, it is from “consumer confidence rising.” Really? In the current, unceasing downturn, I read it as people have no cash, are un/underemployed, etc., and are resorting to their credit cards for day to day expenses–not that they are buying TVs, washers/dryers, or other high expense items.

It never fails to amaze me when lsm spins away without looking at underlying factors.

ABO2012

herm2416 on July 3, 2012 at 11:11 AM

Flora Duh on July 3, 2012 at 10:50 AM

Ahh, that’s too bad, he is one of my favorites. I love Andy of Mayberry and Matlock.

Cindy Munford on July 3, 2012 at 11:12 AM

Give Barry four more years and he will guarantee that we will construct more and better excuses for failure (with new and improved blame!).

NoDonkey on July 3, 2012 at 10:48 AM


Smack!!!!!

Baxter Greene on July 3, 2012 at 11:13 AM

The private sector is doing fine.

The Rogue Tomato on July 3, 2012 at 10:03 AM

This ^^^

eyedoc on July 3, 2012 at 11:24 AM

Does “manufacturing” include those companies who purchase their
components overseas (China) and then assemble them to sell in
the US?

I was in the manufacturing business. It has been on the decline
for decades.

Amjean on July 3, 2012 at 11:27 AM

The trend is awful…we are approaching another cliff…

PatriotRider on July 3, 2012 at 10:07 AM

…the Major Media won’t let anyone know though…they just want to show Paul Ryan pushing granny off of THAT cliff!

KOOLAID2 on July 3, 2012 at 11:29 AM

Amjean on July 3, 2012 at 11:27 AM

I thought they based it on the purchase and orders of large ticket items but I am probably wrong.

Cindy Munford on July 3, 2012 at 11:36 AM

Barry loses another talking-point. :-)

Punchenko on July 3, 2012 at 11:37 AM

OT

I know it was just a spoof and a silly thing. The example of how a person might conduct his or herself, how he or she might handle serious things and silly things in balanced and wise ways, and how he or she might respect and celebrate the people around, letting them be themselves. It’s OK to enjoy a simple white picket fence, and doing that doesn’t stop a person from being sophisticated. Some things have value, some don’t; you helped hash them for me.

I could never tell you all I got from it.

Rest in peace.

PS: I’m sure you know better than to support Obama’s government takeover of (all x) now, so I’ll let that go. :)

Axe on July 3, 2012 at 11:50 AM

Manufacturing sector shrinks for first time in three years

That’s terrible. I can’t imagine what might have happened about three years ago to precipitate this.

SKYFOX on July 3, 2012 at 11:59 AM

Kermit on July 3, 2012 at 10:32 AM

The government is the problem…and in other news; water is still wet.

Track the number of executive branch employees (EPA, DoJ, etc, ad nauseam) against manufacturing jobs. Nice little bit of negative correlation, isn’t it?

Nathan_OH on July 3, 2012 at 12:06 PM

As pointed out at Mish’s, the ISM report was perfect goose egg for the experts. 0-70 expert economists predicted the below 50 reading.

ZERO FOR SEVENTY.

The new record for EXPERTS and our country is now run by EXPERTS.

jukin3 on July 3, 2012 at 12:06 PM

Andy and Barney get Pickled

Del Dolemonte on July 3, 2012 at 12:28 PM

I assume June’s job numbers will be released today so their full impact is blunted by the long weekend.

MidniteRambler on July 3, 2012 at 12:46 PM

Ecpert: someone 75 miles from home who can convince a jury of their peers they are smarter.

The trend is awful…we are approaching another cliff…

PatriotRider on July 3, 2012 at 10:07 AM

We fell off the mother of all cliffs in 2008. We managed to crater into an outcropping but it is breaking away now. Hang on its going to be a wild ride.

chemman on July 3, 2012 at 12:50 PM

I assume June’s job numbers will be released today so their full impact is blunted by the long weekend.

MidniteRambler on July 3, 2012 at 12:46 PM

I should probably read the story thoroughly, not just skim it.

MidniteRambler on July 3, 2012 at 12:53 PM

At this point I’m surprised it is doing this well.

tom daschle concerned on July 3, 2012 at 1:04 PM

Ed, you missed the punch line of the AP report:

The economy could also get a boost this summer from lower gas prices, which have tumbled more than 60 cents per gallon since peaking in April. The result is that consumers have more money to spend on other goods, from autos and furniture to electronics and vacations, that fuel economic growth.

Yep, the economy is going to be SAVED by falling gas prices. People who were getting hammered and letting other bills slide, now get a reprieve so they can buy that new car, that new flat screen TV and that long awaited vacation!

AP never thinks that just maybe gas prices are falling BECAUSE THE ECONOMY IS SLOWING.

GarandFan on July 3, 2012 at 10:16 AM

Never underestimate a drop in gas prices :)…think all those pennies saved that will go to buying a new car or a trip to Europe or a cruiseto the Caribbeans :)…now, seriously, AP can’t be this delusional, can he…wonder when was the time he travelled, or bought a car (oh, wait, you don’t need a car in NY, really :) or was involved in any such economic/commercial activities…

jimver on July 3, 2012 at 3:46 PM

The last time, that is…

jimver on July 3, 2012 at 3:47 PM

Doesn’t everyone get it by now. Obama is in the redistribution business. He is not into create more goods and services.

SC.Charlie on July 3, 2012 at 3:48 PM

Andy and Barney get Pickled – Del Dolemonte on July 3, 2012 at 12:28 PM

A lot of the cast is now in Mayberry heaven. I miss Barney the most. He was the best deputy Sheriff ever.

SC.Charlie on July 3, 2012 at 3:56 PM

Let’s see how good Barry’s poll numbers are when the words “double-dip recession” come into play in the coming weeks.

He’ll blame Europe, China and George Bush.

Philly on July 3, 2012 at 6:52 PM