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Lombardi Publishing Corporation (www.LombardiPublishing.com), a 28-year-old consumer publisher that has served over one million customers in 141 countries, is cautioning that disappointing third-quarter earnings are a result of growing income inequity in America and point to a weak economic outlook for 2015."Despite decent second-quarter results, a raft of disappointing third-quarter results have added to growing market volatility and concerns about the state of the U.S. and global economies,” says economist and lead contributor Michael Lombardi. “A number of blue-chip companies have revised their guidance lower for the next year, which, as expected, has increased market pessimism.”
Lombardi explains that disappointing corporate earnings are not a huge surprise, considering the U.S. generates approximately 70% of its GDP growth from consumer spending. And the so-called economic recovery hasn’t really benefited the broader U.S. economy; in fact, income inequality in the U.S. is the highest it has been since 1928 and a third of Americans are living paycheck-to-paycheck with little or no savings, says Lombardi. (Source: Luhby, T., “Middle class & living paycheck to paycheck,” CNN web site, April 25, 2014; http://money.cnn.com/2014/04/25/news/economy/middle-class-paycheck/.)
Lombardi observes that the recent flurry of weak economic growth and poor guidance probably won’t be reflected in the fourth quarter, but will show up in 2015. Adding to the fragile outlook for 2015 is anemic growth in China, Japan, and Europe, coupled with a stronger U.S. dollar and lower oil prices.
“Typically, the stock market moves higher when there’s economic growth and lower when there’s economic uncertainty. Since 2009, the catalyst for stock market growth has been courtesy of the Federal Reserve’s $4.0-trillion easy money policy and artificially low interest rates,” Lombardi concludes. “Each time the Fed ends one of its quantitative easing programs, stocks slump. Why would this time be any different? The fact of the matter is that economic growth will occur in the U.S. only when the average American sees their standard of living improve, and this isn’t happening.”
Founded in 1986, Lombardi Publishing Corporation, which has served over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more information on Lombardi Publishing Corporation, visit www.LombardiPublishing.com.
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Name: Wendy Potter
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Organization: Lombardi Publishing Corporation
Address: 350 5th Avenue, 59th Floor, New York, NY 10118
Phone: 905 856 2022
Website: http://lombardipublishing.com/
Release ID: 67887