An economic slowdown is a contraction in the economy. This can be viewed by several indicators, including lower gross domestic product (GDP), higher unemployment, lower industrial production, lower business investment, decline in retail sales, and a decrease in corporate profits. Not all of these factors need to be present for an economic slowdown, but these are some of the main indications to watch for regarding the overall health of the economy.
No matter where you look, major economic hubs in the global economy are struggling to show growth.According to the German finance ministry, Germany’s economy grew at only 0.3% in the second quarter of this year after growing a similar amount in the first quarter. (Source: Reuters, July 19, 2015.) Germany is the fourth biggest economy. Read More
In June, retail and food service sales in the U.S. economy declined 0.3% from May. When calculating these sales figures, the Census Bureau looks at 13 different kinds of businesses. In June, seven of those business types reported an outright decline in sales. (Source: U.S. Census Bureau, July 14,2015.) In particular, American consumers. Read More
The global economy is headed towards an economic slowdown and it will take U.S. stock prices down with it.The growth rates of major economies are anemic. China is growing at its slowest pace in two decades, putting pressure on Australia’s economy. Japan has been going in and out of recession for years now. The crisis in Greece has strained. Read More
According to a study by Economic Policy Institute, a nonpartisan think tank, between 2009 and 2014, the salaries of CEOs at the largest U.S. companies increased by 54.3%. (Source: Economic Policy Institute, June 22,2015.)But the average American hasn’t done that well.Between 2009 and 2013, median U.S. household income declined. Read More
To gauge activity in the global economy, I follow two indicators very closely: how sales at multinational Caterpillar Inc. (NYSE/CAT) are faring; and trade activity in the global economy.Global Economy Indicator #1The chart below plots the percentage change in three months rolling sales at Caterpillar Inc., a large American company. Read More