Deloitte’s mid-year Economic Update
In Deloitte’s mid-year Economic Update, there is promise in a soon-to-be upturn in our economic positioning. They feel confident that the economy should start to turn around the second half of this year (and so do an increasing number of analysts).
THE BAD NEWS
In the retail sector, April sales were disappointing. Except for the gas and automobile industries, sales have been on a two month decline. This following a previous two consecutive months of growth. Even with the slight increase in auto sales, they still have seen a decline in 14 of the last 17 months.
The travel and tourism sector declined for the ninth consecutive months, and according to Chain Store Guide’s annual census of the restaurant industry, in 2008 4.1% of all the restaurants in America closed their doors.
THE GOOD NEWS
Although Deloitte expects that GDP will still remain slightly negative in this quarter, they feel that the worst of the downturn is behind us. The Economic Cycle Research Institute reported that in every previous downturn of the last 75 years, the economy has started to grow no more than four months after its pace of deterioration has slowed. If that is the case, we should be in the positive by Labor Day.
We are not out of the storm yet, but similar to starting a garden we are seeing little sprouts that give us home of bigger and better things to come.
