This year’s second quarter has proven to be eventful in both domestic and international economies. A few milestones occurred last quarter, including negative revisions to GDP growth. The Bureau of Economic Analysis reports that the U.S. economy shrank by -1.00% in the first quarter of the year, the first such result since 2011. Monthly employment numbers for May were released by the Department of Labor, showing that the total number of jobs lost during the recession have been recovered. Six years and four months to recover back to 138.4 million jobs – and all it took was $11.7 trillion of stimulus along the way.
Further indication of economic stagnation was seen when the European Central Bank (ECB) made history by imposing negative deposit rates. “With lackluster U.S. economic data being reported, the continuation of the gradual uptrend in the markets is likely due to the ECB’s commitment to encourage banks to lend more,” says Alex Haas, advisor to Private Clients and Retirement Plans. Such an unprecedented move by a large central bank indicates the ECB is exercising all options to promote economic growth.
clearTREND’s Economic Health IndexTM reflects global economic stagnation with numbers virtually unchanged from last month. “Overall this year, markets are up because of continued stimulus spending. However, recent government reports do not support the notion of a healthy economy,” says Mark Scheffler, senior portfolio manager and founder of The Appleton Group. This month, clearTREND identified trends in the health care and banking sectors, as well as the top employment sectors of the Manitowoc area.
Click here to view this month’s economic data in our digital issue.