Friday, April 30, 2010
Economy Grows 3.2% WHY? 7 Bank Failures and Spain jobless rate 20%
Seven more banks failed on Friday. This time it was much worse than last week's 7 bank closures. These banks are going to hit the FDIC with a $7.4 billion bill. Not only is the size of the failures increasing, but the rate is dramatically spiking. We've had over 20 failures in April along and the total number of for the year is 64.
In other news, the economy expanded by 3.2%. This was mostly customer spending. So is this the big break that economists have been waiting for? Is this the beginning of a recovery?
Not, really. Many people aren't paying their mortgages, so naturally, a lot of people have more money to spend. Plus, you add in the spending of the income tax checks and ignore the banks attempts to hide their toxic assets and you get an increase in the GDP.
Interestingly enough, the increase was below expectations.
So what do you think?