Thursday I ran across an interesting article from US News & World Reports. It said that “Analysts are forecasting a ‘restaurant recession’ in the U.S., which is bad news for America’s food and drink establishments and potentially even worse news for the economy at large.
“Paul Westra, a senior research analyst at Stifel Financial Corp., said in a research note Tuesday that he’d turned “decidedly bearish” on the restaurant industry, downgrading Stifel’s stance on 11 different restaurant stocks, including Chipotle Mexican Grill, Panera Bread and Cheesecake Factory.
He and his colleagues now ‘confidently believe’ that the weak restaurant consumer spending seen in the second quarter of the year ‘reflects the start of a U.S. restaurant recession.'”
“The catalyst for the current weak pre-recessionary restaurant spending trend is likely multifaceted – U.S. politics, terrorism, social unrest, global geopolitics, economic uncertainty,” Westra said. “But, if history is a guide, we warn investors that restaurant-industry sales tend to be the ‘canary that lays the recessionary egg.'”
Add to that the fact that restaurant margins are not high and minimum wage increases in some state harm them, too. You would expect to see a summer increase because of more people on vacation and eating out as well.
Then on Friday it’s announced that our GDP was just 1.2% in the second quarter and the first was revised to .8%. They expected 2.6%. Ouch!
ZeroHedge notes: “As of this moment, the economy has grown at less than a 2% pace for three straight quarters. Since the recession ended seven years ago, the expansion has failed to achieve the breakout seen in past recoveries. The average annual growth rate during the current business cycle remains the weakest of any expansion since at least 1949.”
Yet at the Democrat convention/coronation, Obama spoke as if he had ushered in the best economic years of our lives. Those of us who remember the Reagan years know better.
If you run into some misguided millenials or even old Socialist leaning Americans, Wayne Allyn Root at Breitbart offered these facts to show them:
GDP (Gross Domestic Product) is the only real determinate of economic growth. Barack Obama is the only president in the history of America to preside over seven straight years of GDP growth under 3 percent.
The White House economists just announced that GDP for Obama’s last year will be 1.9 percent. Obama will therefore become the only president in America’s history to never produce a single year of 3 percent or higher GDP. Even Herbert Hoover outperformed Obama!
The longest previous streak of under 3 percent GDP in the history of America was four years (1930 to 1933) during the depths of the Great Depression.
From 1790 to 2000, America’s economy averaged GDP growth of 3.79 percent. Obama’s eight years are on pace to average GDP of 1.55 percent — substantially less than half of our country’s average economic growth for 210 years.
Even worse, GDP for Obama’s entire time as President was just downgraded by the Commerce Department by more than $300 billion.
For the first time in American history, more businesses are being destroyed each day than are being created.
There are 70 percent more Americans collecting entitlement checks than working in the private sector (148 million “takers” vs. 86 million “makers”). This is a fact provided by the U.S. Census Bureau.
Thirteen of the 23 Obamacare State Co-Op Exchanges have failed (gone bust and broke). The remaining 10 have losses of over $200 million per year. The $1.24 billion of federal start-up money used to start them all is most probably gone forever. It will never be repaid.
In this Obama economy, 40 percent of American workers now earn less (adjusted for inflation) than a full-time minimum wage worker in 1968.
Some 20 percent of U.S. families don’t have a single member who is employed.
A record number of Americans are not in the workforce (over 94 million).
More Young Americans now live with their parents than at any time since Great Depression.
43 percent of the 22 million student loan borrowers aren’t making any loan payments.
Two thirds of Americans don’t have $500 for an emergency bill.
Food stamp use under Obama is up by 43 percent.
The number of new food stamp recipients under Obama is 3 times higher than new job recipients (13,298,000 added to food stamp rolls vs 4,276,000 new jobs since January 2009).
The middle class has shrunk in nine out of every ten U.S. cities.
For the first time in almost a half century, the middle class is no longer the economic majority in America. Pew reported the middle class is “disappearing” and “hollowing out.”
It’s a pretty damning scenario and the forecast doesn’t look any better, probably worse.