5 Signs the Economic Recovery Has Hit a Rough Patch

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While it doesn’t look like the boom times are about to go bust again, multiple indicators point to a slowing economic recovery. A return to recession still looks highly unlikely, but a new period of unbridled prosperity may not be in the offing, either. Myriad factors ranging from political intransigence in Washington to a lack of consumer spending across the country to a potential contraction in the real estate market have stock market investors wary and everyday spenders keeping their wallets a bit more tightly closed these days.

5 Durable Goods Orders Have Dropped

When people hear the term “durable goods” there is often some confusion, so let’s first give a few examples. Things such as automobiles, passenger jetliners and refrigerators are thought of as durable goods; these are items expected to last many years. And they are almost universally expensive items, as well. Thus, when orders for durable goods fall, as apparently happened last month, it is an indicator that the overall economy may be contracting, as that means both less money spent and less confidence from would-be spenders ranging from families to multinational businesses to government agencies.

4 Consumer Confidence Is on the Decline

According studies from a range of institutions such as Gallup and the University of Michigan, consumer confidence fell several percentage points in the first weeks of autumn. When Americans feel less confident in their buying, that means they feel less confident in their earnings and job security. And it means the economy is going to take a hit: consumer spending is the single best way to keep the economy at large chugging along.

3 The Jobless Rate is Falling Too Slowly

We had to wait almost three extra weeks for September’s jobs report, thanks to the recent government shutdown. When the report surfaced, however, it was hardly welcomed news. While American employers did add almost 150,000 jobs in September, that figure was so far below the anticipated number of new employment opportunities that many economists actually saw it as a disappointment.

2 The Booming Stock Market May Be Entering Another “Bubble” Phase

The American stock market has seen record highs on many indexes recently, so the casual observer might be forgiven for thinking all is well in the land of investing. But the dramatic rise (the Dow has flirted with never before seen numbers in the upper 15,000s) of the market could portend a precipitous drop. If the Fed changes its monetary policy, if another big bank goes bust or if consumers stop spending, one of the shaky legs propping up this surge could collapse, blowing up all the recent gains of the booming markets.

1 Homes Sales Are on the Decline

It was the housing bubble that sent America (and by extension much of the world) into a tailspin leading to recession back in 2008. Today, though, rather than seeing prices for new homes surging and properties flying off the market, we are starting to see the other unwelcome side of the real estate market: falling sales. The sale of existing homes dipped nearly two percent in September, and homes are sitting on the market for longer periods these days, indicating that demand is falling along with consumer spending confidence.

Steven John is a published novelist and competitive pole vault champion. (The latter is not true.) His writing runs the gamut from speculative fiction to essays fueled by a mix of mirth and derision. He has never been to Lisbon but, statistically speaking, is probably taller than you.

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