FBN Willis Report: Is It Really Just The Weather
Lance Roberts | Feb 21, 2014 12:55AM ET
I recently sat down with Gerri Willis at Fox Business News, along with Rick Sharga to discuss the economy and whether it is really JUST the weather that is dragging on the economic reports as of late...or is it something else?
This is a subject I have touched on recently stating :
"The recent "polar vortexes" have crippled much of the North and the North East with record low temperatures and severe weather and snow conditions. The economic impact of just the first polar vortex that hit in December is already calculated to be well above a $10 billion dollar hit to the economy. Surging electricity and heating costs are eating into real disposable incomes which is diverting consumption away from retailers. Inclement weather has shut down manufacturing activity and will crimp demand for employment and new orders as witnessed by the sharply reduced employment report in December and this week's ISM survey.
The chart below is the STA Economic Composite Index (for details on its construction read this ) from January 2011 to present. As you can see, the trend of economic growth has clearly been on the decline rather than gaining strength as has been hoped by the majority of economists. I have also labeled events that have contributed to the rolling recoveries and slowdowns along the way."
Moreover, as I discuss in the interview below, the trend of consumer weakness, which makes up 70% of economic growth, has declined to levels that are more normally associated with very slow growth economies.
I also agree with Rick's views on the mortgage and housing market. See my latest housing updates below.
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