U.S. Economy Grew -Crystal ball time, folks...

[Neil D]

[:"green"] The economy picked up speed in the third quarter, the government reported today, as consumers encouraged by heavy discounts splurged on cars and trucks and all manner of other goods.

The gross domestic product rose at an annual pace of 3.8 percent from July to September, up from 3.3 percent in the second quarter, the Commerce Department reported. Consumers and the government spent more than they did earlier this year, making up for weaker investment by businesses.

Economists were expecting the economy to grow at a 3.6 percent pace, according to a survey by Bloomberg News, in part because they believed that Hurricanes Katrina and Rita would take a greater toll on the economy than they appeared to have.

"This shows tremendous economic resilience, the fact that we can get a 3.8 percent growth rate with the issues that unfolded in the latter stages of the quarter," said Michael Strauss, chief economist at Commonfund, which manages money for colleges and nonprofit institutions.

The strong G.D.P. report is expected to encourage Federal Reserve officials to raise the benchmark short-term interest rates, now at 3.75 percent, when they meet again on Tuesday, economists said. [/]NYTimes

Ok, the economy grew...Why?

Was it because of all the replacement things that we had to buy for the south with the destruction from the hurricanes? [an aside issue- No wonder we pronounce hurricans "her-icans"... Men MUST buy things for the angry and tick off women in thier lives ]

Was it because of the moneys spent in Washington to fight the scandels????

Was it because the news is capitalizing on desasters?

Is the feds making a big mistake in slowly rising the intersts rates? Isn't that like the proverbial frog in the 'slowly-warming-to-boil' pot? Are we going to have interest rates so high that the americans are used to it and it will always be high?

What is in your all seeing crystal ball?

[Dr. Shane]

The hurricanes slowed down the growth. But fast growth is not good. Slow and steady growth are good. If the economy grows to fast we will have to deal with inflation.

Not only does the fed need to raise interest rates, now would be a good time to bump up minimum wage. Increasing minimum wage also slows down the economy and it hasn't been increased since when? 1997?

[bevin]

SS payments are up 4.x% - inflation is already here

/Bevin

[Dr. Shane]

Yes we are dealing with inflation - mostly due to high energy prices. So the fed needs to consider that too.