Economy Slows in First Quarter; Weaker Jobs Growth Likely
The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.
NEW YORK (TheStreet) -- The economy grew at a 3% annual rate in the fourth quarter of 2011, but first half growth is likely to disappoint, renewing upward pressures on unemployment.
Fourth quarter growth was powered by stronger consumer spending -- especially on autos, substantial additions to business inventories, and stronger multifamily home construction. In the first quarter, gains in consumer spending continued, but outpaced income growth. However, unlike the boom years of the last decade, households are not able to refinance credit card debt and auto loans by further mortgaging their homes, and consumers simply have to slow down soon.
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