The Great Recession Five Years Later… (Bloomberg)
Lehman Brothers, Holdings, Inc., seemed to spur government policies aimed at stimulating the economy after the company filed bankruptcy and sought protection from creditors five years ago this coming Sept. 15. According to Ethan Harris, chief U.S. economist at Lehman Brothers at the time, the economy has emerged from the ruins “in much better health,” growth is picking up and some economists predict the expansion, now in its fifth year, may last longer than most. For investors looking to finally jump back into the game, resurgence is everywhere, but most obviously seen in home and automobile sales, and even financial stocks. As always, though, do your homework and make sure your selection is appropriate for your level of risk tolerance.
United States is on Course to Hit Budget Limits in October (YahooFinance)
Next up on the list of brutal financial truths facing the U.S. economy is the debt ceiling. Original estimates had predicted that the government would run out of money sometime after Labor Day, but a newly revised, mid-October date means that the government must also figure out a way to arrange funding Oct. 1-15. And if you think this new date and need to fund the government for another two weeks lit a fire under the rears of the Congress or the president, think again. It has only made them re-trench their existing positions. And if you’re an investor who’s watching and waiting, you might want to give yourself until the first week of September to see if, or when, the smoke will clear.
U.S. Auto Industry Trailing the Herd (CNBC)
Even though there’s been significant positive movement in car sales since the Great Recession of 2008 (as noted above), U.S. automobile owners would like car makers to know everything’s not peaches and cream. The 2013 American Consumer Satisfaction Index (ACSI) found that owners of GM, Ford or Chrysler cars have earned an average score of 83, below the average of 84 and well below European brands which earned an 85. ASCI researchers say this variance is due — in part — to vehicle reliability, which is “suffering” as automakers scramble to keep up with demand. So before making that new car purchase, you should be aware that “Quality may be giving way to quantity,” according to David VanAmburg, director of the ASCI. And in that light, maybe investing in one of America’s Big 3 is a better use of your money than buying a new car right now.