Even More Signs the U.S. Economy is Expanding

     Today more numbers have come out that suggest this may be so. The new report shows that jobless claims were down to 388,000 last week the best number in seven months and the third straight week that claims were beneath 400,000 which is symbolically important. While its generally estimated that the economy will only be improving enough to cut into the 9 percent unemployment rate after we consistently see claims  beneath 375,00 a week, this week we saw the number get closer to the mark.

    http://www.cnbc.com/id/45336527

    Just yesterday I had looked at this after yesterday's numbers showed that industrial production was up and there was even some sign that the housing market was improving with an improvement in homebuilder's confidence.

     http://diaryofarepublicanhater.blogspot.com/2011/11/more-signs-that-ecoomy-is-expanding.html

     http://diaryofarepublicanhater.blogspot.com/2011/11/even-housing-market-showing-signs-of.html

     Speaking of housing, today, "permits for future home construction rebounded strongly last month, bolstering views the economy was gaining traction. "

     Despite all this the market again today is taking a beating. Why? Because of Europe. They remain the weak link.

    "Economic conditions are moving upward at an accelerating pace," said Joel Naroff, chief economist at Naroff Economic Advisors in Holland, Pennsylvania. "However, two major roadblocks stand in the way of solid growth: Rising oil prices and European debt issues."

    Oil prices I even think are a misnomer-I suspect that if we have a recovery we will see oil prices continue to rise-if you look at the way oil has performed the last 10 years it's actually a growth indicator. High oil prices may be part of long term reality. The only time during this last decade we saw oil drop was during the Lehman implosion from late 2008 till early 2009. As this was part of a deflationary shock it in no way was beneficial to us even though oil fell from $147 to $30.

     The solution would be developing green energy like they have done in Germany. But on the level of economics this is what we have seen. In the 90s we had high growth and expansion with low oil prices but this has not been the paradigm over the last decade and nothing other than doing something about green energy has a chance of stopping it, which is a political issue not an economic one as the only way to achieve this through the economy is via deflation.

    Europe remains the problem which is why Obama along with leaders in Canada, China and Japan are trying to get Europe to you know what or get off the pot.

    http://diaryofarepublicanhater.blogspot.com/2011/11/obama-calls-out-europe.html