The 5.9 percent annualized surge in fourth-quarter growth -- the fastest since 2003 -- was powered more by exports and business investment than the traditional drivers of consumption and housing. This new mix of demand will boost the economy by 3.7 percent in 2010 and pave the way for 3.5 percent annual average increases thereafter, said Joseph Carson, an economist at AllianceBernstein in New York, who coined the phrase. (...) "What's going to change is how we generate growth, not how fast we can grow," Carson said in an interview. "That's how I come up with a new mix rather than a new normal."(...) Advocates of both camps agree consumption will be restrained as households struggle with an unemployment rate that remained at 9.7 percent in February and a $12.6 trillion reduction in their net worth during the recession. They also agree that emerging markets, not the U.S., will lead the world economy in the recovery. Where they differ is on the extent that U.S. companies can tap into expansion overseas, boosting domestic growth in the process.
Good News for US Markets
Now that stocks and the dollar are moving in tandem again, it could be a signal for investors to put more money into US assets. For much of the 2009 rally off the March lows the two entities had been in reverse lockstep. When the dollar would fall, stocks would rise and vice versa.
For much of the 2009 rally off the March lows the two entities had been in reverse lockstep. When the dollar would fall, stocks would rise and vice versa.
It's worth mentioning that an appreciating U.S. dollar could cut into exports. The greenback got pummeled for much of 2009, but has been rising lately as the Euro and British pound suffer under the weight of Europe's economic problems. For now, futures prices suggest the dollar is expected to end the year up only about 1%.
First, US domestic sourced products are too expensive, considering the alternatives available from China, India, Indonesia, & etc. The prime culprit for this is the very high Cost of Living - comparatively - in the US.
Secondly, exponential growth is mathematically and physically impossible to maintain forever. At some point the whole thing shifts into a positive feedback loop in the negative direction until a new equilibrium is achieved.
Leading the way in November were food, grains and beverages exports, most notably soybeans, which increased $979 million, compared with October. Two big railroads--Union Pacific Corp. and Burlington Northern Santa Fe Corp.--flagged the upswing in soybeans in their latest results. Burlington Northern said Friday that although revenue from agriculture products was down 2% versus a year ago, volumes improved, "primarily driven by strong soybean exports."
The U.S. export to China ranges from jumbo jet to farm produce. However, high-tech exports are banned. The U.S. government intensified restrictive measures in 2007, according to Chen. Chen said the U.S. restrictive measures were not fair for the U.S. exporters, producers and consumers, notably against the background that President Obama pledged to double U.S. exports in five years to sort out unemployment.
Chen said the U.S. restrictive measures were not fair for the U.S. exporters, producers and consumers, notably against the background that President Obama pledged to double U.S. exports in five years to sort out unemployment.
