Want a scare? I know it's Halloween, but this is genuinely frightening.
Not good. Not good at all.
The Bureau of Economic Analysis released third-quarter gross domestic product numbers yesterday, and overall real growth at 3.5 percent was pretty good.But examining the components of GDP reveals a more disturbing picture. While consumption, exports, and the government sector were up, private investment has fallen through the floor.
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The third quarter GDP numbers show that the economy is only starting to "recover" because of growing government and expanding consumption, which has been artificially inflated by large government transfers.
Business investment continues to be in a deep recession. Companies are simply not building factories or buying new machines and equipment.
Why not? I suspect that many firms are scared to death of higher taxes, inflation, health care mandates, increased labor regulation, and other profit-killers coming down the road from Washington. That is speculation, but I haven't heard a better explanation of the death of private investment in America.
The freefall began in 2006. What was significant about that year? It marked the beginning of what Bizzyblog proprietor Tom Blumer calls the POR (Pelosi-Obama-Reid) economy.
I think we were both reading Memeorandum a moment ago.
