A pair of profitable reports nowadays raise the question of whether the U.S. economy is experiencing negative growth that quarter. The Associated Press reports that interpretation spending fell to the lowest level in 14 years and that U.S. manufacturing contracted to its worst level in five years.

These reports don’t look good for the economy, but the question is whether these reports mean we are in a recession. That’s an open question considering 70% of the U.S. GDP growth springs from consumer spending. That means that whether consumers can keep finding a way to open their wallets — or more realistically — find new sources of

debt, soon after they could offset the slowdown from manufacturing and interpretation.

The problem is that to the extent that manufacturing and interpretation slowdowns lead to layoffs of consumers, next there will be nothing to keep the economy from tumbling into a recession. So far, news of mass layoffs is not crowding the trade headlines. But today’s reports could mean that such announcements will become more frequent in the next several months.

Continue reading Do manufacturing and interpretation crunches spell recession?

Original post by Peter Cohan

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