(Clickonthechartforalargerversion)

Also,theselatestGDPfigureswereheavilyboostedbybusinessesrestocking(adding1。

9%toGDP)whichdoesnotpointtoastrongrecovery。

Inotherwords,companieswererebuildingtheirinventories。

Thatsuggestsbusinesseshavebeenmakingmoregoodsthantheycouldsell,whichcouldseeproductionslowdowninfuture。

ThefactisthattheUSremainsaconsumer-driveneconomy,andthereisnohardevidencethatUScitizensaresuddenlygoingtostartspendingtheamountsofmoneyneededtorestoretheeconomytohealth–retailsalesgrewbyapaltry0。

1%inDecember。

Somepointtoincreasedconsumerborrowing(seechartbelow)asabullishsign,butit’snotasignofstrength。

ConsumersspendingmorethantheyearnedisoneofthechiefreasonsAmerica’seconomyisintrouble:itisnotthesolutiontoitsproblems,norisitasourceofsustainableeconomicgrowth。

PercentagegrowthinUSconsumercredit

Moremoneyprintingisontheway

AsinBritain,theeconomicboomintheUSwasbasedonflakyfoundations。

Excessconsumerandgovernmentborrowingbroughtforwarddemandfromthefuture,andisnowplayedout。

UScompaniescontinuetoimproveproductivity,butaredoingsowithfewerworkers,whilsthouseholddisposableincomesarebarelymatchinginflation。

WhileUSconsumershavereducedsomeoftheirdebt(mainlybydefaultingonmortgagesandotherdebts),itisstilltoohigh。

HousepricesarestillfallingwhiletheUSgovernmentstillcontinuestospendmorethanittakesin(backedupbyBenBernanke’shelpfulprintingpress)。

Indeed,MrBernanke’sintentionstokeepinterestratesatverylowlevelsuntil2014arehardlytheactionsofamanexpectingareturntosoaringeconomicgrowth。

Soonerorlater,theUSgovernmentwillhavetotakeanaxetopublicspendingvoluntarily,orthebondmarketwillforceitto。

Thiswillremoveafurthersourceofdemandfromtheeconomy。

Inthemeantime,America,likeBritain?

isleftwiththelargelyineffectivepolicytoolsofverylowinterestratesandmoneyprinting。

AndthislatestdatasuggeststhatMrBernankemightgettheopportunitytoturnonthepressesearlierthanhe’dexpected。

ReadmycolleagueJohnStepek’sMoneyMorningarticleformoreonhowyoucanprofitfromthis。

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