Consumption spending slowing down

Here's why I believe that the current high price of oil is not enough to derail the U.S. economic recovery.

From NY Fed President William Dudley: The Road to Recovery: BrooklynOn the national economy:[E]conomic growth so far this year has been disappointing. Real GDP in the first quarter of 2011 grew at a tepid 1.8 percent annual rate, and the available data suggest that growth in the current quarter will not be much better.

Californians who bought gasoline on Friday experienced an unpleasant shock.

I keep on hearing we have a spending problem, but no revenue problem, from you know whom. I decided to appeal to actual data. Below is a time series plot of Federal current expenditures and tax receipts plus contributions to Federal social programs, as a share of GDP, over the 1967Q1-2011Q1 period. The data are based upon the data definitions in the BEA’s national income and product accounts (NIPA), as of June 2011. Outlays are declining, and as of 2011Q1 are at 0.25, which exceeds the previous peak, during the Reagan era, at 0.241 (1982Q4).

Oil and gasoline prices are probably the biggest downside risk to the economy right now. Oil prices are off slightly today, from the WSJ: Oil Prices Ease

The BEA released its report today on "Personal In

Reggie Middleton submits:A quick summary of mainstream American news shows a bright green light toward economic growth as the “Great Recession” finally disappears into the metaphorical rearview mirror. A variety of shapes and letters have been used to describe the path of the economic recovery, most famously, the “V shaped” return of American output.