We are reasonably sure we understand the words “acceleration” and “breakout”, and we’re also quite confident that the chart below does not evidence any such thing.
The fact is, for the entirety of this so-called recovery the US economy has been laboring heavily against the headwinds of monumental domestic debts and the strip-mining of corporate America by financial engineering obsessed C-suites. So notwithstanding the worst recession in the post-war era, there has been no sustained breakout of GDP growth and return to the pre-crisis expansion path.
Instead, there have been unusually large oscillations around the tepid expansion trend that has occurred since June 2009. These reflected short-run global commodity, production and trade sub-cycles driven by the erratic credit impulses of the Red Ponzi, as well as fluctuations in domestic inventory stocking cycles.
As is evident in the chart, these 4% plus growth spurts were not sustainable, but they are operative again owing to short-run global trade perturbations. These emanated from China’s most recent credit surge to smooth the way to Xi Jinping’s coronation as emperor for life last October and the Donald’s maniacal tariff-threatening gong show this year.