US Economy Surpasses Pre-Recession Level
It has taken 15 quarters for the economy to recover, which is 3 times longer than avg
The value of goods and services produced in the US surpassed its pre-recession level after 15 quarters, taking three times longer than the average for 10 previous recoveries since World War II.
Gross domestic product expanded at a 2.5% annual rate in the period from July through September, the Commerce Department reported on Thursday, the fastest pace in a year and up from 1.3% in the prior threemonth period. After adjusting for inflation, GDP climbed to $13.35 trillion last quarter, topping the $13.33 trillion peak reached in the last three months of 2007.
“The American economy finally has accomplished the recovery and has now entered the expansion,” said Neal Soss, chief economist with Credit Suisse in New York, who was an aide to former Federal Reserve Chairman Paul Volcker. “But the growth is clearly too slow to solve the most significant problems the economy faces: jobs and getting the public budgets under control.” Consumers reduced savings to boost purchases and companies stepped up investment in equipment and software, even as the biggest drop in incomes in two years raises concerns about whether the spending increase will continue. The number of Americans with jobs last month, 131.3 million, was lower than the 138 million workers in December 2007, when the 18-month recession began, according to Labor Department data.
The US economy expanded at an average 0.9% rate in the first half of 2011, the worst performance since the recovery began in June 2009. Growth needs to exceed 2.5% to reduce the jobless rate, according to estimates by Kurt Karl, chief US economist at Swiss RE in New York. Unemployment stuck around 9% or higher for 30 months explains why Federal Reserve policy makers, who meet next week, and the Obama administration are considering additional measures to boost the economy.
My suggestion here for my readers are:
Look out for stocks which has given good nos this qr comparing with last yr qr or can give good nos for whole year then last year.The reason I am saying so is, when the global economy has slowed down,Inflation is at it's high, USA bleeding (means less consumption and hence less export orders),India GDP and IIP is down and still those Cos makes better profit then last year or last year qr then those Cos are ought to make better profit when tides will turn .
Here in India Int rate is about to peak out and with government looking for better policy, we are in for good times.That is what it looks like.......Bulls in India can make a comeback before anyone can have a clue of what is happening.......Our market has consolidated for a very long time and has taken excellent support at nifty 4700 which it looks now difficult to be broken.
And if there is short position in excess then the upmove will be equally sharp and huge.
Flipkart which I discussed sometime back has caught the eyes of some FII's and I am glad to see it too:
October 25, 2011, 11:09 AM IST
Although the Indian online retailing market is small now, few people doubt that e-commerce will one day be big business in India, a country of 1.2 billion people whose rapid economic growth is adding millions to the middle class every year.
The Indian e-commerce market is expected to grow by 47 per cent to more than Rs 460 billion ($9.2 billion) this year, according to the industry group Internet and Mobile Association of India.
US private equity firms Carlyle and General Atlantic will pick up a minority stake in Flipkart after their investment, said two sources with direct knowledge, declining to be named as the talks are not public yet.
A deal is being held up due to differences in valuation between Flipkart and the investors, one of the sources told Reuters.
Sachin Bansal, chief executive and co-founder of Flipkart, declined to comment when reached by Reuters. Carlyle also declined to comment, while General Atlantic did not immediately respond to mail seeking comment.
Flipkart is India’s biggest online bookseller, with over 10 million titles distributed from warehouses in five cities. It also sells mobile phones, appliances, gaming consoles, music and movies.
It generated $11 million in sales last financial year, and expects revenue to cross $100 million this year. It is targeting $1 billion in revenue by 2015.
Bangalore-based Flipkart had earlier raised $31 million in funding from US venture capital firms Tiger Global Management and Accel Partners, which has a stake in Facebook.
The company, set up by two ex-Amazon.com software developers in 2007, got its first round of funding worth $1 million by Accel Partners in 2009, followed by Tiger Global’s $30 million investment in two tranches.
The possible fourth round of funding by Carlyle and General Atlantic would help Flipkart to boost its business network ahead of Amazon’s entry into Asia’s third-largest economy, one of the sources said.
Amazon, the world’s top online retailer, has no formal presence in India yet, though a source said last month it was mulling plans to set up retail operations in the country next year.
Private equity investment in India is accelerating, as rising borrowing costs and dormant public markets push firms to cut deals with buyout firms in return for much-needed cash injections.
Indian companies signed private equity deals worth $3.2 billion in the first nine months of 2011, up from nearly $2 billion in the same period last year, according to data from Thomson Reuters.
The deals include India’s second-biggest private equity investment of the year, with Apollo Global Management injecting around $500 million in Indian steel pipe maker Welspun group in June.
India is flooded with private equity firms looking for investments — from global buyout shops like Blackstone, 3i Group and KKR, to homegrown firms like IDFC and IFCI.