The economy-halting winter of 2013-2014 will hobble growth for the rest of the year

posted at 2:01 pm on June 16, 2014 by Noah Rothman

Observers were shocked in May when the first quarter of U.S. GDP growth was revised from an anemic 0.1 percent growth to an objectively repulsive -1.0 percent collapse. Administration allies and economists alike insisted at the time that this development meant that the harsh winter of 2013-2014 had curtailed economic activity even more than was previously believed.

“This quarter reflects everything that’s been bad about the long and cold winter,” Millan Mulraine, head of U.S. research at TD Securities, told Bloomberg in late April. “It betrays fairly strong underlying fundamentals that we believe continue to exist.”

“Nobody likes to see a negative for growth,” Standard & Poor’s Ratings Services economist Beth Ann Bovino told The Wall Street Journal after the GDP’s negative revision. “But it doesn’t change my expectation that the economy is recovering at a nice pace. I call it a recovery delayed.”

Well, it seems that the delayed economic recovery is set to remain delayed for the foreseeable future.

“The International Monetary Fund foresees the U.S. economy growing a modest 2 percent this year, below its previous estimate of 2.7 percent,” the AP reported on Monday. “That would be nearly identical to the economy’s 1.9 percent growth in 2013.”

In spite of the anticipated rebound in economic activity, the IMF report claimed, growth will not be strong enough to offset the damage done by the unusually cold winter months. Blame climate change.

While the economic rebound will alleviate some concerns about stalled growth, it is unlikely to assuage voters’ concerns about the troubling trajectory of the country. According to Gallup survey data released on Monday, virtually every indicator measuring voter satisfaction with their representatives ahead of the 2014 midterm elections is at or near historic lows.

According to that survey, only 23 percent described themselves as satisfied with the “way things are going in the United States.” That is nearly identical to 2010, when just 22 percent said they were happy with the direction the country was going in and 15 percent of incumbent House members lost their reelection races.

While Americans remain concerned about the economy, the perception that economic conditions are improving is becoming more widely shared. Nevertheless, apprehensions about the state of the economy remain prevalent.

Although Americans’ confidence in the economy is improving slightly, the public still shows greater concern over it than in prior midterm election years. Specifically, 44% mention an economic issue when asked to name the most important problem facing the country. That is significantly higher than in the 1998, 2002, and 2006 elections, but is down sharply from 2010, reflecting improvements in the economy since then.


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Obama has the Midas touch.

Cicero43 on June 16, 2014 at 2:04 PM

Of course…because winter is one of those unpredictable seasons that occurs yearly because of global warming.

MikeInBA on June 16, 2014 at 2:05 PM

…the perception that economic conditions are improving is becoming more widely shared.

In this case, perception will not become reality.

cozmo on June 16, 2014 at 2:07 PM

Just when you think they set the bar low enough, they dig it up again and bury it deeper.

Axeman on June 16, 2014 at 2:07 PM

Dang that global warming!

otlset on June 16, 2014 at 2:07 PM

Winter Shitstorm is coming. –House Obama motto

Rix on June 16, 2014 at 2:07 PM

Global warming and Bush.
And shut up.

Dr. Carlo Lombardi on June 16, 2014 at 2:09 PM

Yet Wall Street is booming.

DDay on June 16, 2014 at 2:09 PM

The administration can always ask their new BFF’s, the Iranian mullahs, for economic assistance.

MTF on June 16, 2014 at 2:10 PM

The economy-halting winter of 2013-2014 will hobble growth for the rest of the year

Yeah, it was the winter that did it. We’re just not used to winter here in these United States.

There Goes the Neighborhood on June 16, 2014 at 2:10 PM

Blaming the weather for economic failure has been a standard technique in socialist nations for decades.

TB on June 16, 2014 at 2:10 PM

Winter was a minor factor.

I’m blaming the Godzilla attack.

forest on June 16, 2014 at 2:11 PM

Between the EPA war on energy other than “green” slush funds and the disruptions to the oil markets, we’re about to get clobbered.

cthemfly on June 16, 2014 at 2:11 PM

So, just noticing the headlines while the Distracter-in-Chief golfs:

Russia continues Ukraine abuses-
Shillary calls the kid-gloves media treatment the most brutal in the world-
The ‘winter effect’ on the economy lasts throughout the year-
IRS lies about the Lerner emails-
VA punishes whistle-blowers-
Kerry proposes we may become involved with Iraq–after Booosh got us in there more than a decade ago–

Do these guys do anything other than lie?

socalcon on June 16, 2014 at 2:15 PM

Yeah, it was the winter that did it. We’re just not used to winter here in these United States.

There Goes the Neighborhood on June 16, 2014 at 2:10 PM

This. No one seriously believes a couple months of heavy snow and bad weather will cripple the economy for the entire FY 2014. The fact of the matter is the issue is more than likely the effects of the Fed’s horrible post 2008 policies coming home to roost.

Doomberg on June 16, 2014 at 2:17 PM

Blaming the weather for economic failure has been a standard technique in socialist nations for decades.

TB on June 16, 2014 at 2:10 PM

This. Remember, Kim Jong Un was just shown yelling at weathermen for screwing up the North Korean economy somehow.

JeremiahJohnson on June 16, 2014 at 2:18 PM

Because there were never harsh winters prior to January 2009

stop2think on June 16, 2014 at 2:19 PM

The subtitle on this piece should be …

IMF Declares Global Warming Dead

J_Crater on June 16, 2014 at 2:19 PM

“The International Monetary Fund foresees the U.S. economy growing a modest 2 percent this year, below its previous estimate of 2.7 percent,” the AP reported on Monday

How much of that growth is inflationary growth? Companies are doing more or getting by with less employees and businesses/consumers are buying fewer things at higher prices. So yeah, growing GDP 2% or even 25% means nothing without actual productivity and purchasing power for context.

AH_C on June 16, 2014 at 2:19 PM

Perfect excuse for what will apparently be the new Majority Leader, amnesty shill Kevin McCarthy, to bring amnesty to the floor for a vote, because the establishment leadership will say it will create “economic growth.”

From the Washington Times:

We who oppose amnesty had better not let our guard down.

That warning was echoed Friday by a leading foe of amnesty for illegal aliens, Rep. Steve King, Iowa Republican, during his guest appearance on “The Ernest Istook Show” on The Washington Times Radio Network.

House Republican leaders have not backed away from possible efforts to push pro-amnesty legislation. Only a relative handful of GOP votes would be needed to pass it, when combined with overwhelming support from Democrats in the House of Representatives.

Despite the primary election defeat of House Majority Leader Eric Cantor, Virginia Republican, the likely successor tilts more strongly than Cantor toward pro-amnesty legislation, says King, commenting about Rep. Kevin McCarthy, California Republican: “If it’s a shift, it’s a shift to the left, not to the right, not to conservative principles. Kevin McCarthy has been clear that he’s supportive of the Senate’s ‘Gang of Eight’ amnesty bill that is instantaneous and perpetual and retro amnesty.

Read more: http://www.washingtontimes.com/news/2014/jun/16/istook-amnesty-effort-remains-alive-house-gop-lead/

anotherJoe on June 16, 2014 at 2:20 PM

In spite of the anticipated rebound in economic activity, the IMF report claimed, growth will not be strong enough to offset the damage done by the unusually cold winter months. Blame climate change.

Man, that Reagan guy sure was lucky that he never had to deal with any seasonal shifts in the weather for his 8 years in office. Same with Clinton.

Doughboy on June 16, 2014 at 2:20 PM

The dog ate the economy.

TarheelBen on June 16, 2014 at 2:20 PM

Yeah, it wouldn’t have anything to do with a federal government that has been spending this country into decline. Next up, multi-billion dollar VA bill and encroaching Obamacare.

rickv404 on June 16, 2014 at 2:21 PM

…virtually every indicator measuring voter satisfaction with their representatives ahead of the 2014 midterm elections is at or near historic lows.

… but we’ll send close to 100% of incumbents back to DC anyway, won’t we…

Midas on June 16, 2014 at 2:22 PM

Yeah, it was the winter that did it. We’re just not used to winter here in these United States.

There Goes the Neighborhood on June 16, 2014 at 2:10 PM

Aye – cuz winterrr is coming, and it’s goin’ to be a long one…..
Err, uh, well, except for that whole globull warming thingy that should eliminate winter – right?…..

dentarthurdent on June 16, 2014 at 2:23 PM

“This quarter reflects everything that’s been bad about the long and cold winter,”

But…but…but the AGW crowd says that things are getting WARMER!

GarandFan on June 16, 2014 at 2:23 PM

Because there were never harsh winters prior to January 2009

stop2think on June 16, 2014 at 2:19 PM

Of course not, cuz, well, The Won stopped the warming and stopped the oceans from rising – which uh leads to a winter like we’ve never ever had before, except for, uh – shut up – IT’S SETTLED!!!!

dentarthurdent on June 16, 2014 at 2:25 PM

Yet Wall Street is booming.

DDay on June 16, 2014 at 2:09 PM

Until the FED stops printing money, then it’s Katy Bar the Door!! The last time they just talked about it the market was down 400. An actual movement in that direction and……..CRASH!!

Deano1952 on June 16, 2014 at 2:31 PM

“This quarter reflects everything that’s been bad about the long and cold winter,”

Can’t have it both ways, folks. Either the climate is going to end the world and destroy our economy from all the heat or it’s not. Guess it’s not.

el hombre on June 16, 2014 at 2:31 PM

We’re coming up on the mid-terms and Dems are using some kind of tree-ring proxy to measure the economy. Even though we’re in negative growth the economy is doing great! Their tree-ring proxy (the vague perception that the economy is growing) says everything is okay.

Kevin R on June 16, 2014 at 2:33 PM

Hey, check out Drudge. All is swell, taxes are pouring in, golfing is good, unemployment is saved, by obama, the world is at peace.

What is your peeve?

Schadenfreude on June 16, 2014 at 2:34 PM

Here’s an idea soooooooooo crazy that it just might work.

Make energy cheaper by not regulating plant food (CO2) so that we can have warmer winters. Right, you know because our high CO2 ppm is supposed to make snow free and warm winters and that equals high GDP growth rates.

jukin3 on June 16, 2014 at 2:35 PM

Obama has the reverse Midas touch.

Cicero43 on June 16, 2014 at 2:04 PM

.
Clarified for libfreeorcry…
.
Damn that GoreBull Warming!
.
Government can reconstruct an economy which was about to correct itself by losing the crony capitalists and bankers…. waddaya got to say about that, Brat? You cannot ignore this thread!

ExpressoBold on June 16, 2014 at 2:38 PM

… but we’ll send close to 100% of incumbents back to DC anyway, won’t we…
Midas on June 16, 2014 at 2:22 PM

“We’ll vote someone new for U.S. Rep when everyone else does. We don’t want to be represented by the least senior member in the House.”
- Every U.S. Rep district

Answer: Term limits. Pipe dream, I know.

Marcola on June 16, 2014 at 2:39 PM

Obama has the Midas touch.

Cicero43 on June 16, 2014 at 2:04 PM

Just wait ’til we see how he touches us this summer.

But…but…but the AGW crowd says that things are getting WARMER!

GarandFan on June 16, 2014 at 2:23 PM

Wellll, summer is just a week away, so I’m thinkin’ they’ll be mostly right for the next few months.

hawkeye54 on June 16, 2014 at 2:40 PM

OK…why are my comments going to moderation?

Was it the non-Fox Business link I tried to post twice (once with and once without spacing)?

Am I getting Caspered? O_O

Newtie and the Beauty on June 16, 2014 at 2:43 PM

Do these guys do anything other than lie?

socalcon on June 16, 2014 at 2:15 PM

Yeah. They also steal.

Rix on June 16, 2014 at 2:47 PM

Yeah, right, ol’ man winter is ruining the economy. That’s it. I got it now. Yo comprendo.

HiJack on June 16, 2014 at 2:47 PM

The winter hard drive failed, racists.

rogerb on June 16, 2014 at 2:49 PM

Maybe some journalist could dig up when, in the history of economics, a long winter has ever had a 1.1% affect on GDP. What a crock. For every project that was delayed, you had expenditures on salt, road crews, all of the private contractors cleaning parking lots, gasoline, heating oil, etc, etc. The economy did not shut down. I don’t know a single person that was out of work due to the weather. Every carpenter, pipefitter, electrician, engineer, every grocery clerk and banker that I know went to work.

GlobalTrvlr on June 16, 2014 at 3:02 PM

If Obamacare, Dodd Frank, Federal Permitoriums, higher taxes, war on coal etc. = Climate Change

Then yes, the stagnating economy is due to climate change./s

KW64 on June 16, 2014 at 3:12 PM

I recall when the left was claiming that a particularly good economic quarter for Bush was because of a bad winter which resulted in increased consumption of energy, heating oil and coal and other cold weather necessities.

tommyboy on June 16, 2014 at 3:13 PM

While Americans remain concerned about the economy, the perception that economic conditions are improving is becoming more widely shared. Nevertheless, apprehensions about the state of the economy remain prevalent.

Just pick a damn lane and stay there, will ya.

Tsar of Earth on June 16, 2014 at 3:17 PM

When Democrats (including Pelosi, Reid, and then-Senators Obama, Biden, Clinton, Kerry, etc.) took control of the House and Senate on 1/3/2007, they inherited a GOOD economy from the outgoing Republicans.

Democrats trashed the economy by raising the minimum wage 3 times, blocking reform of Fannie & Freddie, and supporting TARP, Porkulous, Cash for Clunkers, and other massive deficit spending.

There has been NO recovery in the last 5 years, and there is no recovery in sight, as long as Democrats remain in majority control.

ITguy on June 16, 2014 at 3:21 PM

In spite of the anticipated rebound in economic activity, the IMF report claimed, growth will not be strong enough to offset the damage done by the unusually cold winter months. Blame climate change.

CURSE YOU GLOBAL WARMING!

CURSE YOU!

BKennedy on June 16, 2014 at 3:27 PM

While Americans remain concerned about the economy, the perception that economic conditions are improving is becoming more widely shared. Nevertheless, apprehensions about the state of the economy remain prevalent.


Horseshite!

The Kneepad Media, Obama propagandists (but I repeat myself) and the chattering class (that’s you, Noah) have a NARRATIVE of “perceived improvement of economic conditions” …

… but anyone who reads or listens to something other than the KneePad Media (you’ve just proven that’s NOT you, Noah) knows more that that entire worthless lot combined.

Financial Times reports Central Banks have invested $ 29 trillion USD in stocks and bonds to keep markets afloat

Central banks around the world, including China’s, have shifted decisively into investing in equities as low interest rates have hit their revenues, according to a global study of 400 public sector institutions.

“A cluster of central banking investors has become major players on world equity markets,” says a report to be published this week by the Official Monetary and Financial Institutions Forum (Omfif), a central bank research and advisory group. The trend “could potentially contribute to overheated asset prices”, it warns.

The report, seen by the Financial Times, identifies $29.1tn in market investments, including gold, held by 400 public sector institutions in 162 countries.

.
Pop quiz, Noah:

1) What happens when the markets revert to mean? (And the markets ALWAYS revert to mean.)

2) What happens to all that “investments” value the Central banks have on their balance sheets?

3) Read the closing part of the Financial Times article – What are the implications that the Central Banks are currently only taking a partial write down on their balance sheets for an estimated $ 200 – 250 billion USD in losses?

4) Do YOU have ANY clue what these financial terms even mean?

5) What’s WORSE than a global depression?

The only people more repulsive than the GOPe are the GOPe-media who shovel the GOPe propaganda hand over fist.

PolAgnostic on June 16, 2014 at 3:30 PM

Uh, Noah, that “economy-halting winter of 2013-2014″ was the result of 5 years of economy-halting incompetence.

formwiz on June 16, 2014 at 3:44 PM

OK…why are my comments going to moderation?
 
Was it the non-Fox Business link I tried to post twice (once with and once without spacing)?
 
Am I getting Caspered? O_O
 
Newtie and the Beauty on June 16, 2014 at 2:43 PM

 
CNN links get eaten whenever I try them. YMMV, though, because I’ve seen other posters link them successfully.

rogerb on June 16, 2014 at 3:45 PM

Has a sluggish economy ever been blamed on an unusually hot summer?

pain train on June 16, 2014 at 3:49 PM

When adjusted for population growth averaged over the last four years at 0.7% (not counting illegal immigration), and adjusted for the official Bureau of Labor Statistics annual inflation rate of 2.0%, the economic forecast actually becomes a negative number. So the economy is contracting even according to official numbers, which are significantly undercalculated

magnetism87 on June 16, 2014 at 3:51 PM

Observers were shocked in May when the first quarter of U.S. GDP growth was revised from an anemic 0.1 percent growth to an objectively repulsive -1.0 percent collapse. Administration allies and economists alike insisted at the time that this development meant that the harsh winter of 2013-2014 had curtailed economic activity even more than was previously believed.

Why don’t they lie about that, like they do with everything else? Just say that the economy grew at 3 percent.

/only half joking

Ward Cleaver on June 16, 2014 at 3:52 PM

Blaming the weather for economic failure has been a standard technique in socialist nations for decades.

TB on June 16, 2014 at 2:10 PM

This. Remember, Kim Jong Un was just shown yelling at weathermen for screwing up the North Korean economy somehow.

JeremiahJohnson on June 16, 2014 at 2:18 PM

Ha! This was exactly my first reaction as well!

KMC1 on June 16, 2014 at 3:58 PM

17 trillion in debt.

Obamacare.

An insane and ever-growing regulatory burden.

Rising student debt.

WWIII just over the horizon.

They’ll be damned lucky just to be able to jigger the statistics enough to get a 2% growth rate.

trigon on June 16, 2014 at 4:06 PM

The winter also killed the elderberry scrub and English ivy behind my house. It was tough.

thuja on June 16, 2014 at 4:33 PM

Just wait until this next winter when La Nina is in full swing. It will be mild but the necessarily skyrocketing energy prices will make it seem worse. Man caused global warming?

jake49 on June 16, 2014 at 4:34 PM

How convenient. And also a load of garbage.

MaxBC on June 16, 2014 at 4:43 PM

What a bunch of hooey!

The winter wasn’t that long or that cold to affect GDP more than marginally for one month. All the rosy predictions of 3.5-4% growth this year were made well into the winter.

The problem is Obama and regulations and anti-growth policies generally.

You can’t have your socialist cake and expect to eat it, too – under Obama’s plan, prices naturally skyrocket, and there will only be enough to give the Commissars a taste.

Adjoran on June 16, 2014 at 4:46 PM

Somebody needs to buy Barry this book.

Now, Noah. This is more of your sense of humor showing, right? No would blame a whole year of a cruddy economy (which followed five other years of cruddy economies) on winter. Not really…

Fallon on June 16, 2014 at 4:48 PM

So now, some lefty PhD in economics is blaming then problem on the weather? And Kerry thinks global warming is the cause of every war? Does anyone in this Dem administration have any brains?

I knew our education system was failing but this Dem administration, for the most part, went through schools that were still teaching the truth. What happened?

MN J on June 16, 2014 at 5:56 PM

In all fairness, who could possibly have anticipated that winter would be cold and snowy? Oh wait, my copy of the Farmer’s Almanac lying right here was pretty much dead-on for the last 8 months.

But then I’m sure that the enviro-types who have taken over NOAA and the Weather Channel didn’t believe the Farmer’s Almanac since it uses historic data of that big yellow ball in the sky to make predictions instead of continuously discredited computer climate modeling.

deepdiver on June 16, 2014 at 6:09 PM

“Climate change” my arse. This double-dip DEMpression is systemic.

Steve Eggleston on June 16, 2014 at 6:11 PM

Now, Noah. This is more of your sense of humor showing, right? No would blame a whole year of a cruddy economy (which followed five other years of cruddy economies) on winter. Not really…

Fallon on June 16, 2014 at 4:48 PM

President Jake Blues and his Presstorian Guard – Business Division will.

Steve Eggleston on June 16, 2014 at 6:12 PM

17 trillion in debt.

trigon on June 16, 2014 at 4:06 PM

$17 trillion in debt is so 2013 – we’re over $17.5 trillion in debt now.

Of note, the publicly-held portion of the debt is nearly $12.6 trillion. The total amount of debt on 1/19/2009 – $10.6 trillion ($6.3 trillion publicly-held).

Steve Eggleston on June 16, 2014 at 6:17 PM

Is TD getting their talking points from the White House? Of course investment bankers want everyone to believe the economy is doing great to justify their astronomical share prices.

Faramir on June 16, 2014 at 6:34 PM

So the economy is in the tank due to a long harsh cold winter brought on by global warming? I didn’t realize so much of the economy took place out-of-doors. Are we sure this shrinking economy have nothing to do with the azzhole in the oval office?

lel2007 on June 16, 2014 at 6:39 PM

But then I’m sure that the enviro-types who have taken over NOAA and the Weather Channel didn’t believe the Farmer’s Almanac since it uses historic data of that big yellow ball in the sky to make predictions instead of continuously discredited computer climate modeling.

deepdiver on June 16, 2014 at 6:09 PM

I personally judge how harsh winter will be by watching to see how much firewood the Indians are collecting…..

dentarthurdent on June 16, 2014 at 6:50 PM

I personally judge how harsh winter will be by watching to see how much firewood the Indians are collecting…..

dentarthurdent on June 16, 2014 at 6:50 PM

I watch to see what color the deer turn in the fall. The darker the gray color the worse the winter will be.

trigon on June 16, 2014 at 7:00 PM

This happens every year. That’s why America has not progressed economically since the early 1600s.

Dr. ZhivBlago on June 17, 2014 at 9:44 AM