From Bloomberg:
Orders for U.S. durable goods dropped more than forecast in April, reflecting a slump in aircraft demand and disruptions in supplies of auto parts stemming from the earthquake in Japan.
The 3.6 percent decrease in bookings for goods meant to last at least three years was the biggest since October and followed a 4.4 percent surge in March that was larger than previously estimated, a Commerce Department report showed today in Washington. Economists projected a 2.5 percent April decline, according to the median forecast in a Bloomberg News survey…
So, once again it is “unexpected”. There is a lot of blame being laid on Japan here, but as Mish points out, things are slowing down everywhere, and Japan isn’t responsible for all of that. I don’t think we can point to one thing and say, “there’s the culprit”. There are so many fundamental flaws in the global economy – with over-indebtedness leading the pack – that everything is at fault. Even the supposed good news we get spoon fed by government and MSM can often reflect an underlying bit of bad news (so, high stock prices – good news! – actually reflect rising inflationary pressures).
The global economy is conking out – and that is because the engine of economic growth is the United States (for all the talk of China rising to replace us, most people don’t realize that the per capita GDP of China isn’t even a tenth of the US…it would take about 3 billion Chinese to make up for what we do in the world; and there’s only about half that number). Because we don’t produce as much wealth as we should the rest of the world is floundering – everywhere you peek at global economic statistics you see ever more problems…housing bubbles popping, inflation wiping out wealth, energy shortages, etc, etc, etc. Until we clear the decks and get back to work, the best we can hope for is a stagnant global economy. At worst, we’ll slide right in to Depression.
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