US economy doing poorly

Monday’s weak US retail sales showed that the world’s biggest
economy is slowing very quickly, leading one economist to claim
America has gone from “first half hero to second quarter
zero.”  The 0.5% fall for June was far worse than expected and
the third monthly drop, the longest run of falling sales since
2008 when the Lehman crisis led America into recession.  “Given
how rapid the slowdown in job growth has been, it is hard to
blame consumers for their increased caution,” said Capital
Economics chief US economist Paul Ashworth.  Arguing that the
data showed just how quickly the US recovery has gone “from
first-quarter hero to second-quarter zero.” Ashworth believes
the slowdown echoes what we saw in the second quarter of 2010.
That slowdown ultimately led the Federal Reserve to launch a
second round of quantitative easing later that year, but Ashworth
believes Federal Reserve Chairman Ben Bernanke will need more
evidence before pulling the trigger on another round of easing.
“The bar to QE3 is higher than for QE2, if only because there
is considerable skepticism that balance sheet expansion will
accomplish much,” said Ashworth.