Mish's Global Economic Trend Analysis

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I Can't Get No Satisfaction Posted: 12 Aug 2013 08:51 PM PDT Following several months of 30% readings (not that 30% is anything to brag about), U.S. Satisfaction Sinks to 22% in August U.S. satisfaction suffered a setback this month, after a two-month upswing. Twenty-two percent of Americans say they are satisfied with the direction of the country, down from 28% in July and 27% in June. Three-quarters of Americans are now dissatisfied with the nation's course, up from 68% in July. In general, are you satisfied with the way things are going in the Unites States at this time? Given the decline, America's mood is now on par with the lowest readings seen since early 2012, including March of this year, when 21% were satisfied. Democrats maintain higher satisfaction than either political independents or Republicans, a pattern seen throughout President Barack Obama's White House tenure. Nevertheless, their satisfaction fell seven percentage points this month (from 44% to 37%), consistent with the six-point drop among Republicans (from 14% to 8%), and slightly greater than the four-point drop among independents (from 25% to 21%). Gallup expressed the opinion the drop in satisfaction levels was political rather that economic. I suggest otherwise, but it's hard to say given the up and down fluctuation this year. Regardless, it's time for a musical tribute. Link if video does not play: Rolling Stones: "Satisfaction!" Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Finding Hope When It's Hopeless Posted: 12 Aug 2013 03:50 PM PDT The New York Times reports Greek Economy Shrinks for 20th Straight Quarter The Greek economy posted its 20th consecutive quarterly decline in the three months through June, government data showed on Monday, but a slower pace of contraction provided a glimmer of hope for beleaguered Greeks. Gross domestic product shrank by 4.6 percent in the second quarter compared with the same three months a year earlier, the official Hellenic Statistical Authority said. That was an improvement from the first quarter of 2013, when the economy contracted 5.6 percent compared with a year earlier. Ben May, an economist in London with Capital Economics, said the latest number was "encouraging, as it looks like the quarterly pace of decline is slowing." An analysis of the second-quarter figure suggested that G.D.P. might have ticked up by about one-tenth of a percent from the first quarter, he said. "The troika's forecast for a 4.2 percent annual decline in 2013 looks achievable," Mr. May said. But it remains "plausible," he said, that the Greek economy will continue shrinking into 2015. He forecast a 2 percent decline in G.D.P. for next year, followed by a 0.5 percent contraction in 2015. Illusion of Hope Allegedly GDP improving from negative 4.6% to the target of negative 4.2% provides a glimmer of hope. Please be serious. This is what the Greek unemployment rate looks like. Youth unemployment is about 65%. Let's assume the Greek economy improves steadily over the next two years and by 2015 Greece does even better than expected and achieves 0% growth. Three Questions Can Greece suffer through another two years of rising unemployment and stay committed to the Euro? What will the unemployment numbers look like in two years? How fast will the unemployment rate drop when growth does return? Hope is an illusion provided by economists who think Greece should stay committed to the Euro even as the cancer of unemployment spreads and numerous structural problems remain unsolved. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

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