US Economy Threatnened By Inventories

[Economy 52,835]

http://www.cnbc.com/2016/05/13/march-business-inventories.html

 

One of the indications that economists look at when gauging the health of an economy is not looking so good

 

US inventories grew to a 2 year high.

 

If inventories rise it means consumers are not keeping up with productive capacity. Production and Consumption are not in balance. Prololongued periods of inventory rises could result in job cuts in manufacturing as orders fall and in retail as well

 

Recessions are almost always predecessed with high inventories, but high inventories dont always cause recessions. All depends on a variety if factors.

[PaperIz 7,354]

Your threads always scare me  

[Cheap thrills 1,282]

Just now, PaperIz said:

Your threads always scare me  

[SissyFromSpace 20,884]

2 minutes ago, Cheap thrills said:

Either engage in discussion or leave. Don't pollute the threads with stupid, tacky GIFS. I'm grateful Economy is a member here; always updating the forums with news regarding today's society. 

[Cheap thrills 1,282]

1 minute ago, Lance said:

Either engage in discussion or leave. Don't pollute the threads with stupid, tacky GIFS. I'm grateful Economy is a member here; always updating the forums with news regarding today's society. 

I'm not trying to be funny or anything, sorry if the GIF made it seem like that but I honestly don't understand

[PunkTheFunk 125,703]

3 minutes ago, Lance said:

Either engage in discussion or leave. Don't pollute the threads with stupid, tacky GIFS. I'm grateful Economy is a member here; always updating the forums with news regarding today's society. 

I was literally about to post this gif

and your post stopped me in my tracks

[Seeka 12,372]

Thank for the reminder that we are probably heading toward global financial apocalypse.... when was the last time that happened?

But seriously, these threads always scare me. But something tells me if Economy can point it out, something can be done about it.

[DeanWinchester 41,390]

17 minutes ago, Economy said:

http://www.cnbc.com/2016/05/13/march-business-inventories.html

 

One of the indications that economists look at when gauging the health of an economy is not looking so good

 

US inventories grew to a 2 year high.

 

If inventories rise it means consumers are not keeping up with productive capacity. Production and Consumption are not in balance. Prololongued periods of inventory rises could result in job cuts in manufacturing as orders fall and in retail as well

 

Recessions are almost always predecessed with high inventories, but high inventories dont always cause recessions. All depends on a variety if factors.

But the US is having an election season. Isn't local consumption increased during campaign periods?

I might have to cash out my investment soon. 

[Economy 52,835]

56 minutes ago, A Gaga Lad said:

But the US is having an election season. Isn't local consumption increased during campaign periods?

I might have to cash out my investment soon. 

I dont know how much consumption rises during campaings. But if it did rise, production and/imports rose more than peoples consumption. So consumption is keeping up. 

 

Anyway not everytime we get inventory builds we get recessions. Hopefully its nothing

 

Two years ago inventories were also as high as they are now and some economists worried but nothing happened.

[Economy 52,835]

1 hour ago, Seeka said:

Thank for the reminder that we are probably heading toward global financial apocalypse.... when was the last time that happened?

But seriously, these threads always scare me. But something tells me if Economy can point it out, something can be done about it.

Theres always stuff that can be done

 

but economy is hard to predict. Theres always positive forces and negative imbalances at the same time and its hard to try and analyze which forces will dominate

 

At the moment we have positive upward pressure on wages and  job creation has been decent. Also debt levels at the consumer level have dropped.

 

But consumers have been reluctant to spend, interest rates have to go up from here, inventories are high (as discussed already), equity market is stretched, and Global Soverein debt is high

 

Addtiinally the global ageing polulation is helping global economic growth. Low productivity gains since mid 2000s are also not helping

 

Not saying a big crash is iminent. Just that theres a lot of risks at the moment.

[DeanWinchester 41,390]

2 hours ago, Economy said:

Two years ago inventories were also as high as they are now and some economists worried but nothing happened.

Well the Chinese market crashed last year but I guess that's not really directly related.