The U.S. economy: barely moving

Dawson offered the analogy of a horse-drawn covered wagon traveling slowly west across the hot, dry, desert southwest United States: you're moving, but if you don't find water pretty quick, there's going to be a problem.

Dawson said that due to the requirements of a return on equity, and the continual, monthly increase in new adults eligible for work, the U.S. economy must grow by least 2% per year, to remain healthy. "A 2% or better GDP growth rate increases demand for goods and services, which leads to profit growth and job growth. Ideally, we should grow at or above 3% per year. Some economists put it slightly lower, but I tend to argue with the higher GDP growth models."

However, if growth drops below 2%, bad things occur, like that slow-moving covered wagon, economically speaking, Dawson said. "Growth came in at a negative 0.2% in the fourth quarter of last year, at 0.9% in the first quarter and 1.9% in the just completed second quarter, so we're well below that 2.0% mark, during the last nine months," Dawson said. "That's why people looking around see lay-offs, reduced staffing, and why many businesses, particularly retail, are seeing less traffic. What we're experiencing is a growth-recession."

'When upscale wine sales decline....that's a danger sign'

And it doesn't take the investigative zeal of a John Walsh to detect the tell-tale signs of the growth-recession. Many retailers are being hit particularly hard. A native of Chicago, Dawson likes to pick up an upscale bottle or two of wine at a favorite, trendy wine shop when he visits his parents back in the Windy City. Dawson said a chat with the wine shop's owner indicated that "wine sales were down about 20-25%, on a year-over-year basis." The shop had laid-off one employee, and reduced hours on Monday to a half-day, "because no one was coming in the store on Mondays," he said.

"When upscale wine sales decline, that's a problem, a danger sign for the economy because it shows that even upper-middle-income consumers are cutting-back spending, are concerned about the economy's health. Mall store owners, particularly discretionary purchase stores, and restaurants are feeling the slow growth conditions keenly also," Dawson said. "But really, the slow growth conditions are all around, except in the oil patch states. This is what a growth-recession looks like."

What will it take, to get this nation's economy moving again?, to quote President John F. Kennedy.

"We need a growth engine, be it an investment in infrastructure, renewable energy, information technology, or business investment etc. ...something that solves a pressing problem, creates good jobs, and makes the nation more prepared for the international economy of the 21st century," Dawson said. "When that occurs, the growth-recession will be over."

Economic Analysis: On to economist Dawson's analysis we'll simply add we hope that growth engine appears sooner rather than later: there's plenty of work to be done [electric grid, highways/rails, hospitals, schools, renewable energy].