"But when that debate prevents us from carrying out even the most basic functions of our democracy- when our differences shut down government or threaten the full faith and credit of the United States- then we are not doing right by the American people."
State of the Union 2014
There wasn't much excitement in President Obama's State of the Union address, but there were plenty of things about which to be worried, including the notion that frustration with the process and having to engage in debate is too much of a hassle, so it's time to usurp the intent of the Constitution and go with executive orders.
Investing For Growth (Capex Spending)
This earnings season we’ve seen companies that carry goods across the nation commit to spending a lot more to carry out the job in the future. Capex spending increases point to a belief that demand will grow. Yesterday, Arkansas Best reported it would increase capex to $100m or 400% more than they invested in 2013.
We are reminded that awful things happen to America, like a government shutdown, and not paying our creditors by debating them. I have a serious issue with the notion that the government shutdown was such a bad thing.
Sure, there were parts that should have been avoided, and Republicans actually tried to make it happen by passing several bills in the house for things like veterans' pay and opening national parks, but any entity with 800,000 non-essential workers should be pared down for its own survival...in this case our survival.
The partial shutdown helped the economy, just as sequestration has dramatically forced down the deficit and made room for capital to find its way into the private sector.
The partial government shutdown that began in the middle of the third quarter didn't stop that GDP report from being one of the best of the entire Obama administration, and the preliminary GDP report for the fourth quarter saw very positive signs.
GDP 4th and 3rd quarter 2013:
Consumption 3.3% from 2.0% (best in three years)
Non-residential fixed investment 3.8% from 4.8%
Residential fixed investment -9.8% from 10.3%
Federal government spending -12.6% from -1.5%
Savings rate 4.3% from 4.9%:
Get the Market Movements in Advance: William's Edge Webinar for Monday, March 10th, 2014 | John Ransom