Michigan Economy Shifts Into High Gear in January as Economic Activity Index Reaches 6-Year High
Comerica Bank's Michigan Economic Activity Index rose seven points in January, up to a level of 98. The January index level is 38 points, or 63%, above the index cyclical low of 60, and marks the highest index reading since January 2006 (see chart above).
"A rebounding U.S. auto industry drove our Michigan Economic Activity Index sharply higher in January, after stalling in late 2011. Every component of the Michigan index increased in January, a sign that the recovery in Michigan is reaching beyond the revitalized auto industry and into the non-manufacturing sectors of the state economy," said Robert Dye, Chief Economist at Comerica Bank. "Threats to the Michigan economy are still visible in the form of cooler global macroeconomic conditions, higher energy prices and expected cuts in federal defense spending. However, these headwinds are not expected to reverse the state's recent hard-fought gains."
4 Comments:
Expected cuts in federal defense spending will slow economic recovery ????
This guy is an economist?
Since when is a reduction in federal spending an impediment to growth? (and no, no one is cutting defense spending, federal agencies are never cut. They grow less quickly than they wanted to, and that is called a cut).
I wish Michigan the best. With housing costs low, Michigan may have a brighter future than many think.
Right now, Michigan is subsidizing the Kentuckys and farm states.
The solution is to reduce money sent to DC, not more defense spending.
BTW, this is what Dick Armey (!) says about military spending.
Obama Disguises Military Budget Increase as a Cut
Wednesday, 11 Jan 2012 02:54 PM
By Dick Armey
From the FreedomWorks website.
A top news story of the day is that President Barack Obama is supposedly cutting almost half a trillion dollars from the defense budget. But this is simply not true.
President Obama is not cutting a single dime out of the military budget. He is actually substantially increasing military spending over the next several years. Washington has once again cleverly disguised a spending increase as a “cut.”
This is how it all works: the Congressional Budget Office (CBO) has a baseline that predicts what will happen over the next decade given current projections of taxation and spending. It shows that military spending will dramatically increase over the next 10 years.
President Obama’s $480 billion in military spending “cuts” are only from the bloated CBO baseline. This means that he is merely reducing projected military spending, as opposed to cutting current spending.
--30--
It is obvious the US military-homeland security-VA complex has become parasitic coprolite. They suck down seven percent of our GDP, sucking life out of the pirate sector, into the dead public sector.
How can we compete with nations that spend far less on such waste?
Started with one thought, ended with another.
I hope that the pirate sector does have life sucked out of it. (No room for courtesy over typos.)
Let's look at cuts, and the effective rates of cuts over terms. Maybe you haven't looked at the budget passed in the House today. But it is important to look at reductions in rates of increase. To not do so is to voluntarily blind yourself, something that only works with an eye-patch. Which pirates had to an abundance. And peg-legs.
Rates of increase/decrease are important in the long-run. Clearly, I'm not a Keynesian. But, I am a businessman, and planning for the long-run is essential when one in attempting to score success. Sure, you can come back and re-define goals, but goals are only important if you meet or exceed them. If you fail, then you get a government loan.
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Ahhh, the magic of having less Granholm and more common sense rears its financially rewarding head...
Ten Mile: "hope that the pirate sector does have life sucked out of it...
...To not do so is to voluntarily blind yourself, something that only works with an eye-patch. Which pirates had to an abundance. And peg-legs."
In this context, I believe Benji meant to type "parrot" sector. :)
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