Thursday, April 28, 2005
What energy crisis?
George W. Bush looks out on his world and sees that it is very very good indeed.
Exxon Mobil Sees Profit on Oil, Gas PricesMeanwhile, the view from anywhere other than Texas...
Exxon Mobil Corp., the world's largest publicly traded oil company, said Thursday that first-quarter earnings soared 44 percent from last year, due mainly to strong crude and natural gas prices.
Economy Grows at Slowest Pace in Two YearsWell, I certainly feel better, knowing that President Bush is diligently on the job, pressing for ever more tax cuts and the privatization of Social Security. I'm sure that will do the trick. After all, it's worked so wonderfully so far.
Buffeted by rising energy prices and weakened consumer and business spending, the economy grew at an annual rate of just 3.1 percent in the first quarter. The slowest pace of expansion since in two years was evidence of a new "soft patch."
The latest reading on gross domestic product, released by the Commerce Department on Thursday, showed that consumers and businesses turned cautious in their spending in the January-to-March quarter, a key factor in the slower economic growth. High energy prices and rising borrowing costs are causing Americans to tighten their belts a bit.
On Wall Street, stocks slumped. The Dow Jones industrials were down 54 points and the Nasdaq was off 10 points in morning trading.
In second report Thursday, the number of new people signing up for unemployment benefits rose last week as businesses coped with rising costs. New claims rose by 21,000 to 320,000, the Labor Department said.
The newest snapshot of the economy disappointed economists. Before the report's release, they were forecasting a 3.5 percent growth rate for the first quarter.
For now, economists believe any soft patch will be temporary and don't believe that it would be a harbinger of recession. Although a 3.1 percent growth rate is disheartening to economists , it is a decent pace of expansion, nevertheless.
"That's about average growth. You can't say average growth is bad. Of course, every parent wants their children to be better than average," said Ken Mayland, president of ClearView Economics. "It doesn't mean that the game is lost and you are inevitably heading toward a major slowdown or recession."
President Bush wants to see the economy on solid ground as he tries to sell Americans his vision of overhauling the Depression-era Social Security program. He is promoting the idea of letting workers set up individual investment accounts in stocks and bonds, using a big chunk of payroll taxes to do that.
The signs of slowing economic growth are especially disconcerting because they raise new questions about the state of the labor market, whose recovery from the 2001 recession has been uneven. Payrolls expanded by just 110,000 in March, the fewest new jobs in eight months. The employment report for April will be released by the government next week.
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