Tuesday, December 22, 2009

GDP

The GDP numbers were under the consesus, this would normally bode bad for the market. One thing that sticks out to me is the bad number and goverment spending. The reason this bodes so close to me is that i am in the service industry. My family owns an airconditioning company and they are going full tilt installing new air conditioners so homeowners can obtain tax credits. With all the goverment spending how can we have bad GDP numbers?

We are also still importing way more than exporting. This is a trade deficit and isn't good for us in a couple of ways. I recently read that the united states subisidizes sugar growers so we can pay $.22 a pound at the store. Sugar sells for $.06 a pound everywhere else in the world. Now this article was written in 2006 ,but it goes into detail how much this costs the goverment. This one bill runs about $150 billion a year. The article breaks out how many sugar growers there are in the united states. He concludes by saying we would be better off to pay these farmers $100k a year for the rest of thier lifes and payoff thier homes and give them each a Ferrari.

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