Saturday, January 03, 2009

US economy is slipping further

RBC has reported that the US economy is slipping deeper into recession

U.S. economy slipping off the brink

The U.S. economy contracted by one-half of one percentage point in the third quarter with consumer spending declining at the steepest pace in 28 years and business spending softening. Export growth slowed and the widespread weakening in global economic activity sets up for a further deterioration in the fourth quarter of this year.

With these conditions persisting early in the fourth quarter, we expect an even heftier decline in real GDP in that quarter.

The tightening in lending standards that is making borrowing more difficult and expensive is setting the stage for consumer and business spending to contract further. Consumers are also facing deteriorating balance sheets and growing job losses.

This would mark two consecutive quarters of declining activity, although the National Bureau of Economic Research (NBER) did not bother to wait and has already indicated that the U.S. recession commenced December of last year on the basis of weakening labour markets since the start of 2008.


  1. i look to see 2009 to be a year where we level out and just move sideways for a little while

  2. thanks for your comment, and yes, I agree, let's hope for some stabilization in the real estate market and the economy this year.

    All the best!

  3. I think moving sideways is a very positive viewpoint, almost too positive. I think 2009 will be a large correction year, in both Canada and the US real estate markets with it starting to level out in 2010.

    Just my opinion.

    Ryan Philipenko - Real Estate in Edmonton