Top Financial Newsletter Profit Confidential Reports U.S. GDP Drops 25%

The U.S. Department of Commerce reported that the American economy grew by 1.5% in the second quarter of 2012. Compared to first-quarter GDP growth of 2.0%, this is a decline of 25.0%. According to Michael Lombardi, lead contributor to Profit Confidential, GDP growth in consumer spending in the second quarter was the lowest in a year, meaning any real economic growth is unlikely.

In the article “U.S GDP Growth Falls 25%; What Happens Next,” Lombardi also notes that durable goods orders are too weak to spur economic growth and consumer spending in any meaningful way.

“The most fascinating part of the U.S. economic growth report consisted of the revisions in GDP growth for the previous three years,” says Lombardi.

The Profit Confidential lead contributor highlights that the big downward revision in 2010 caused the economic recovery to be even worse than expected.

“GDP growth coming out of the financial crisis is lower than what was first reported,” he notes.

For 2008–2011, real disposable personal income was revised downward; it was overstated to the tune of $163 billion.

According to Lombardi, the downward revisions highlight the fact that the consumer is much worse off, with their real disposable income actually much lower than previously thought.

“This is not going to help consumer spending going forward and will certainly not contribute to positive GDP growth,” says Lombardi.

Profit Confidential, which has been published for over a decade now, has been widely recognized as predicting five major economic events over the past 10 years. In 2002, Profit Confidential started advising its readers to buy gold-related investments when gold traded under $300 an ounce. In 2006, it “begged” its readers to get out of the housing market…before it plunged.

Profit Confidential was among the first (back in late 2006) to predict that the U.S. economy would be in a recession by late 2007. The daily e-letter correctly predicted the crash in the stock market of 2008 and early 2009. And Profit Confidential turned bullish on stocks in March of 2009 and rode the bear market rally from a Dow Jones Industrial Average of 6,440 on March 9, 2009, to 12,876 on May 2, 2011, a gain of 99%.

To see the full article and to learn more about Profit Confidential, visit www.profitconfidential.com.

Profit Confidential is Lombardi Publishing Corporation’s free daily investment e-letter. Written by financial gurus with over 100 years of combined investing experience, Profit Confidential analyzes and comments on the actions of the stock market, precious metals, interest rates, real estate, and the economy. Lombardi Publishing Corporation, founded in 1986, now with over one million customers in 141 countries, is one of the largest consumer information publishers in the world. For more on Lombardi, and to get the popular Profit Confidential e-letter sent to you daily, visit www.profitconfidential.com.

Michael Lombardi, MBA, the lead Profit Confidential editorial contributor, has just released his most recent update of Critical Warning Number Six, a breakthrough video with Lombardi’s current predictions for the U.S. economy, stock market, U.S. dollar, euro, interest rates and inflation. To see the video, visit http://www.profitconfidential.com/critical-warning-number-six.