U.S. Economy Cools in the Second Quarter and IMF Cuts Global Economic Outlook

U.S. and Global Economy Cooling

From the sidelines, everything looks great on Wall Street. Stocks are up with the S&P 500, Nasdaq, Dow Jones Industrial Average, and Toronto Stock Exchange all at, or near record levels. The stock market is a forward-looking indicator, so that bodes well for growth prospects. Or does it? Precious metals are also on a tear with gold at multi-year highs and silver gaping up. Investors typically pour into precious metals as a hedge against economic uncertainty. Recent economic indicators suggest contrarian investors are onto something. U.S. gross domestic product (GDP) slowed in the second quarter and the International Monetary Fund recently slashed its outlook for global GDP.

Most investors are extremely optimistic. But that sunny confidence may be a little misplaced. There are just too many economic indicators pointing to a cooling of the global economy, which would have a negative impact on North American stocks.

U.S. GDP stumbled in the second quarter, slowing to 2.1%. Admittedly, that’s better than the 2.0% gain Wall Street was looking for but is much less than the 3.1% GDP registered in the first quarter.1

What pushed down U.S. GDP? Trade tensions dragged U.S. GDP to its slowest pace since Donald Trump ascended into the Oval Office. Business investment was down and exports slumped. If that continues, hiring could slow down or lead to layoffs which would cobble consumer spending. And consumer spending is a big part of the U.S. economy; the biggest, accounting for two-thirds of U.S. GDP.

In fact, second quarter U.S. GDP numbers would have been a lot worse too had consumers not kept the U.S. economy afloat. Consumer spending advanced 4.3% in the second quarter, the best data since the fourth quarter of 2017.

American consumers can only keep the U.S. economy chugging along if trade tensions subside, exports pick up, and wages rise. If not, the risk of a recession in 2020 is looking more and more likely.

It’s not just the U.S. economy that is struggling. The IMF cut its outlook for global economic growth in 2019 to 3.2%. That forecast has been going lower for the last two years. In April, the IMF pegged global growth at 3.3%, last year it was looking at 3.6% growth, and in 2017 was predicting GDP would advance 3.8%.2

The IMF is blaming weaker global GDP data on escalating trade tensions between the U.S. and China. There might be a so-called truce between the U.S. and China but that doesn’t point to an end to tensions, it just points to ongoing policy uncertainty. And that kind of self-inflicted pain isn’t going to juice the North American or global economy.

Learn-To-Trade.com, Canada’s Leader in Stock Market Trading Courses

Will the cooling U.S. and global economy derail the longest expansion on Wall Street? More and more analysts think a recession is possible in 2020. Fortunately, the trading experts at Learn-To-Trade.com can teach investors how to profit no matter what the broader markets are doing.

Learn-To-Trade.com is the leading and oldest provider of stock market trading courses in Canada. Over the years, our professional traders have taught investors, of every skill level, how to trade more confidently and profit more consistently.

Our instructor’s will show you how to conduct a technical analysis, read economic cycles, and spot market trends. You’ll also learn about foreign markets, commodities & futures trading, stock index trading, forex, and cryptocurrencies. We’ll also teach you about risk management and capital preservation.

At Learn-To-Trade.com, we understand that investors have different needs, that’s why we provide a unique, Lifetime Membership that allows you to re-attend any part of the program as often as you’d like.

To learn more about Learn-To-Trade.com’s stock market trading course, contact us at 416-510-5560 or by e-mail at info@learn-to-trade.com.

Sources:

  1. “Gross Domestic Product, Second Quarter 2019 (Advance Estimate) and Annual Update,” Bureau of Economic Analysis, July 26, 2019; https://www.bea.gov/news/2019/gross-domestic-product-2nd-quarter-2019-advance-estimate-and-annual-update.
  2. “World Economic Outlook, July 2019,” International Monetary Fund, July 23, 2019; https://www.imf.org/en/Publications/WEO/Issues/2019/07/18/WEOupdateJuly2019.

Photo Credit: iStock.com/Yozayo

The following two tabs change content below.
George Karpouzis is the co-founder of Learn-to-Trade and has been personally providing education and mentoring to over 3000 members since 1999. George has been trading in the stocks, options, futures and forex markets using technical analysis since 1986. With the help of advancements in trading technology the Learn To Trade program is now accessible worldwide. His background and passion for teaching brings an invaluable asset to our members. George is constantly striving to improve the program content and develop new strategic relationships for the benefit of the members. Add me to your G+

Testimonial 1

Don’t hesitate jump into it right now. You will be glad you did!

Susan C

Learn To Trade
4.0
2014-08-19T04:45:40-04:00

Susan C

Don’t hesitate jump into it right now. You will be glad you did!

Testimonials 2

The ongoing support has been the reason for my success

Patrick L

Learn To Trade
4.0
2014-08-19T04:46:33-04:00

Patrick L

The ongoing support has been the reason for my success

Testimonial 3

I wanted to let you know that I had taken your course in the fall of 2013. I took your advice and used demo accounts for the last quarter of 2013. I switched to real money trading account in the Near Year, when I finally felt comfortable. Following the lessons taught to me by you (don’t jump on a moving train, peaks and valleys, EMA..etc), I wanted to let you know that I have been successful beyond my own expectations. Thank you very much – taking the Learn-to-Trade course was, by far, the best decision I made in my business career.

Steven R

Learn To Trade
4.0
2014-08-20T02:56:18-04:00

Steven R

I wanted to let you know that I had taken your course in the fall of 2013. I took your advice and used demo accounts for the last quarter of 2013. I switched to real money trading account in the Near Year, when I finally felt comfortable. Following the lessons taught to me by you (don’t jump on a moving train, peaks and valleys, EMA..etc), I wanted to let you know that I have been successful beyond my own expectations. Thank you very much – taking the Learn-to-Trade course was, by far, the best decision I made in my business career.

Joseph L

The past options and forex tutorials taught by George were very helpful. I find these tutorials invaluable for a busy person like myself. I was able to keep myself up to date and on track ready to continue the learning process. Thanks for all the help and keep up the great work.

Joseph L

Learn To Trade
4.0
2014-08-20T10:36:37-04:00

Joseph L

The past options and forex tutorials taught by George were very helpful. I find these tutorials invaluable for a busy person like myself. I was able to keep myself up to date and on track ready to continue the learning process. Thanks for all the help and keep up the great work.

Harley S

The course is amazing. Where were you 30 years ago?

Harley S

Learn To Trade
5.0
2014-08-20T10:37:39-04:00

Harley S

The course is amazing. Where were you 30 years ago?

Partick M

I learned the basics I needed to trade successfully.

Partick M

Learn To Trade
4.0
2014-08-20T10:38:34-04:00

Partick M

I learned the basics I needed to trade successfully.

Iouri G

I like making money. I’m very happy, so far so good

Iouri G

Learn To Trade
4.0
2014-08-20T10:39:27-04:00

Iouri G

I like making money. I’m very happy, so far so good

Akos B

I learned things it would have taken me years to figure out

Akos B

Learn To Trade
5.0
2014-08-20T10:40:05-04:00

Akos B

I learned things it would have taken me years to figure out

Robert B

There is always someone ready to answer my questions.

Robert B

Learn To Trade
4.0
2014-08-20T10:40:59-04:00

Robert B

There is always someone ready to answer my questions.

Uldus V

I was impressed with the course’s professionalism and enthusiasm.

Uldus V

Learn To Trade
5.0
2014-08-20T10:41:40-04:00

Uldus V

I was impressed with the course’s professionalism and enthusiasm.

Dean K

I wish I knew about trading as a business years ago!

Dean K

Learn To Trade
4.0
2014-08-20T10:42:24-04:00

Dean K

I wish I knew about trading as a business years ago!

Peter P

Learn to Trade provided me with strategy, self-confidence and discipline

Peter P

Learn To Trade
4.0
2014-08-20T10:42:57-04:00

Peter P

Learn to Trade provided me with strategy, self-confidence and discipline

Shelley P

I took your course in 2008 and loved it. Since then I have been using what I learned at Learn-to-Trade to nicely supplement my pension income. Wanting a carefree type of trading, I have for the most part just sold options and made a monthly income which is a nice addition to my pension. I know I never would have made this kind of trading income without Learn-to-Trade. Thank you!

Shelley P

Learn To Trade
5.0
2014-08-20T10:34:39-04:00

Shelley P

I took your course in 2008 and loved it. Since then I have been using what I learned at Learn-to-Trade to nicely supplement my pension income. Wanting a carefree type of trading, I have for the most part just sold options and made a monthly income which is a nice addition to my pension. I know I never would have made this kind of trading income without Learn-to-Trade. Thank you!

Amir

Hi George,

I just wanted to thank you again for the amazing work on the tutorials especially Options trading.   Prior to joining, I had underestimated the quality of the trainings but they certainly far exceeded my expectations. Only I wish I’d found you 5-10 years ago!

Amir

Learn To Trade
5.0
2016-10-07T08:56:52-04:00

Amir

Hi George, I just wanted to thank you again for the amazing work on the tutorials especially Options trading.   Prior to joining, I had underestimated the quality of the trainings but they certainly far exceeded my expectations. Only I wish I’d found you 5-10 years ago!

Linda S

It is so fun! It is like playing Chess for me. Readjusting my position/move as market reacts. He really enjoying it now (he said it is like going to candy store for him as there are so many options to pick for option strategy). He thinks he can make 100% return. We both really appreciate your program and your teaching! We would not able to trade in less than 2mths if it wasn't for your program!

Linda S

Learn To Trade
5.0
2019-09-04T14:23:05-04:00

Linda S

It is so fun! It is like playing Chess for me. Readjusting my position/move as market reacts. He really enjoying it now (he said it is like going to candy store for him as there are so many options to pick for option strategy). He thinks he can make 100% return. We both really appreciate your program and your teaching! We would not able to trade in less than 2mths if it wasn't for your program!
4.4
15