A few weeks ago, the White House et al assured us that two consecutive quarters of negative GDP growth was the old school way of measuring the economy. No recession, they assured us. Trust us because we know and you don’t, or something like that.
Well, let’s see how they explain this economic story. This is from CNN Business:
Business activity at private US companies in early August dropped off at some of the sharpest rates seen since the beginning of the pandemic as rising interest rates and high inflation crimped consumer spending, according to data released Tuesday.
The latest S&P Global preliminary flash composite purchasing managers index, or PMI, registered a level of 45 as of August 22, down from 47.7 in July.
The rate at which business activity slowed was the fastest recorded since May 2020 when the pandemic shutdowns first took hold, according to S&P Global. This marks five consecutive months that the activity index has fallen and the second consecutive month that it has been in contraction territory. Levels above 50 indicate expansion, while levels below represent a contraction is occurring, according to S&P Global.
Maybe the White House will call it the “monkey pox recession” and tell everyone to put on a mask when they are driving their electric cars.
Another report appeared today. Frankly, it was not shocking because I see that “For sale” signs are not going down as quickly as they did months ago. This is about home sales today:
Only 511,000 new homes were sold last month, at a seasonally adjusted annualized rate, down from a revised 585,000 in June. That’s the lowest sales number since January 2016. A year ago, 726,000 newly constructed homes were sold.
Again, I did not need a report to confirm that slowdown. I remember “for sale” signs up on Monday and gone the next day. We’ve had two signs up around here and they’ve been up for a couple of weeks.