Better Than Expected, Must Be Obama

Annie

Annie

Not So Junior Member
http://www.marketwatch.com/news/story/oil-rises-after-better-than-expected-us/story.aspx?guid={E5F1EFAC-B4A1-4724-890A-ED7120DC39F8}&dist=msr_2

Does this mean inflation is heading our way?

Oil rises after better-than-expected U.S. GDP data
By Moming Zhou
Last update: 2:58 p.m. EST Jan. 30, 2009

NEW YORK (MarketWatch) -- Oil futures rose Friday after data showed that the U.S. economy, the world's largest oil consumer, shrank less than the market had expected in the fourth quarter. The U.S. economy contracted at a 3.8% annualized rate, the worst in 28 years, the Commerce Department reported. But the drop was still above economists' expectations of a 5.5% decline. Crude oil for March delivery ended up 24 cents, or 0.6%, at $41.68 a barrel on the New York Mercantile Exchange. Earlier it rose more than 4% to $43.44. In a week of volatile trading, crude has fallen three out of five sessions. It ended the week down 10% and the month down 14%.
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I would think the economic conditions indicated reduced inflation or even deflation more.

Remember, at the beginning of the great depression we had double digit deflation. This crisis is a lot more like the one in the great depression than the staglation of the 70's.
 
With all of the fiat money being pumped into the system, we most certainly will have to be on the look out for inflation, especially in the latter half of this year. Gold is already showing signs of it.

That said, water is correct... deflation is the primary concern right now. Inflation is a lot less painful than deflation.
 
How much of that GDP was due to oil prices?
Remove oil from the equation and how was the GDP?
I think the price of oil dropped about 72% since last July.
 
Obama's majic will be revealed by dems spinning whatever nubers he gets. We had 1.8 percent growth overAll last year. The same Obama performance that got monkey shit thrown at bush will have turnolibs dropping rose peddles at the messias feet. For this I'm glad the false outrage by dems who can't spell economy will swing to false prophit praise and raise the market.
 
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Threedee said:
Educate me please: why is deflation bad, when we want a strong dollar and good purchasing power?
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Shrinking GDP is not good, deflation will hurt the overall option. Imagine the house you own and pay mortgage on going down in worth by even more than it has already... Then imagine trying to sell that house when the sale wouldn't cover the mortgage.
 
Topspin said:
Also imagine 2 gas vs 4 gas
Flight for 300 vs 600. Etc
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We already have 2 gas v 4 gas and it is a bad example.

Imagine making 1/2 what you make now because everything is "cheaper" but your mortgage doesn't go down, nor do your current credit card bills...
 
Damocles said:
We already have 2 gas v 4 gas and it is a bad example.

Imagine making 1/2 what you make now because everything is "cheaper" but your mortgage doesn't go down, nor do your current credit card bills...
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Oh, okay. So not everything depreciates in value. I was raised on old time radio and movies, and so I have always kind of harbored a dream that we could go back to the days when $0.25 would buy you a movie ticket, popcorn, and a soft drink...
 
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