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The U.S. economy declined in the fourth quarter for the first time since the Great Recession, as growth inched down at a 0.1% annual rate. For the full 2012, the economy grew 2.2% versus 1.8% in 2011 and 2.4% in 2010 -- too tepid to stimulate employment significantly, but perfect for Wall Street, because the Federal Reserve has an excuse to keep pushing interest rates down, despite their extremely low levels.

In the fourth quarter, military spending plummeted 22.2%, although it had zoomed 12.9% in the third quarter. Some local economists believe cuts in defense spending will hurt San Diego this year. Home building was up in the fourth quarter. Military and housing constitute a large percentage of the San Diego economy. Yesterday (Jan. 29), the Standard & Poor's/Case-Shiller home price index showed San Diego County values rising 0.9% in November from October, sharply higher than most of the largest 20 metro areas. Year-over-year, the local increase was 8%, topping gains in most other cities. Many economists expect a big housing rebound sparked by the low interest rates, but Yale's Robert J. Shiller, one of the designers of the index, isn't counting on a boom.

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Comments

Anon92107 Jan. 30, 2013 @ 12:41 p.m.

Don, one thing is certain, media like Fox and the Manchester U-T Journal of Intolerance and Exploitation will continue to make things worse for 99% of us.

We still have a long way to go to achieve permanent economic recovery from the GWB-GOP era disasters because of the destructive special interests that Ike warned us about clear back in 1961 in his Farewell Address.

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Don Bauder Jan. 30, 2013 @ 2:01 p.m.

Anon: Ike famously warned about the military-industrial complex. But in that speech, he also warned about universities being dependent on the government dole. I just posted a blog item about UC workers and students protesting the outrageous pay and pensions of UC top managers. Ike was prescient. Best, Don Bauder

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SurfPuppy619 Jan. 30, 2013 @ 8:53 p.m.

Don, one thing is certain, media like Fox and the Manchester U-T Journal of Intolerance and Exploitation will continue to make things worse for 99% of us.

Anon, public unions are FAR MORE harmful for the "rest of us" than Fox is.

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Don Bauder Jan. 31, 2013 @ 9:53 a.m.

SurfPup: You have Fox and the Manchester U-T pegged very well. Best, Don Bauder

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Anon92107 Jan. 31, 2013 @ 12:45 p.m.

SP, consider this, if Romney had been elected, everyone would want to be protected by a union because Washington would truly become the most intolerant and exploitive government in history.

Romney's speeches proved him to be the worst case scenario False Profit in American history, both socially and morally.

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Don Bauder Jan. 31, 2013 @ 1:10 p.m.

Anon: Agreed. And it was not so much the stupid things he said in public, but the things (like the infamous 47%) he said in private (or at least what he thought was private.) Best, Don Bauder

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SurfPuppy619 Jan. 30, 2013 @ 8:52 p.m.

Double dip TIME.

But the fact is if you take out the feds manipulation of the currency-ZIRP- ewe have probably had negative growth for several quarters.

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Don Bauder Jan. 31, 2013 @ 10:01 a.m.

SurfPup: I think few would disagree with your statement. If the Fed had not lowered short rates to zero and had it not kept buying long paper to drop long rates, the economy would still be in recession. Look at it this way: the stock market has more than doubled since Bernanke began dropping interest rates to record low levels, but the economy has been barely growing at 2%. Bernanke has succeeded in running up stocks but has not succeeded in helping the economy. I think he is more interested in running up the market than in alleviating unemployment. Again I must repeat: Wall Street is living off Main Street's pain, thanks to Bernanke. As long as unemployment remains high, Bernanke will keep rates exceedingly low and Wall Street will be grinning.Best, Don Bauder

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