Capital Gold Group – Current Economic News

CNBC.com
By Alex Rosenberg
June 12, 2013

Every man has a day on which he turns a new leaf. For Peter Schiff , that day has not yet arrived.

This year, “gold can certainly make a move up to $1,700 or $1,800, but I think ultimately it’s going a lot higher than that,” Schiff said Tuesday on CNBC’s ” Futures Now .”

In fact, the gold bull not only remains bullish-he remains extremely bullish.

“When the world figures out the position that we’re in, gold is going to the moon,” said Schiff, CEO of Euro Pacific Capital.

Schiff believes that continued monetary easing from the Federal Reserve will lead to inflation that will spike gold. So does talk that the Fed will look to “taper” easing worry him?

Not in the least.

“The Fed has no exit strategy,” Schiff said. “It’s all fluff. There is no taper, because taper is impossible without collapsing the economy, the banks, and the U.S. government.”

In fact, he added, “what we’re probably going to have to get from the Fed is more QE. They’re going to have to print even more money and buy even more bonds to prevent this market from imploding, and that is extremely bullish for the price of gold.”

So how about in the short term? Schiff admits that the action in gold has not been good-but he believes that gold is undergoing a bottoming process.

“You do have a lot of speculators who have been unwinding their technical gold position; technically there has been a lot of selling, and the sentiment is very negative in the gold market so people are selling the rallies,” Schiff said. “But that’s how bottoms are made.”

And once gold does bottom, the sky is the limit.

“When the gold market turns, it’s going to be vicious,” Schiff said. “And I think it’s going to rally even faster than it went down.”

For Schiff, then, gold’s lunar journey is simply a matter of time.

CNNMoney.com
By Alanna Petroff
June 12, 2013

Brace yourself for another recession and more economic volatility.

Bond giant Pimco believes there is a 60% chance of another global recession in the next few years.

“Given that the last global recession was four years ago, and also given that the global economy is significantly more indebted today than it was four years ago, we believe there is now a greater than 60% probability that we will experience another global recession in the next three to five years,” wrote Saumil Parikh, a portfolio manager and member of Pimco’s investment committee, in a research note.

While inflation should remain “well behaved” in the medium-term, Parikh painted a grim picture for the global economy. He forecast slowing growth rates around the world, continued stagnation in Europe and growing trade and currency tensions between developed markets.

The latest data on gross domestic product shows the U.S. economy grew at a 2.4% annual pace in the first three months of the year as it continues to recover from recession.

Meanwhile, the 17 eurozone nations continue to struggle. The eurozone economy contracted for a record sixth consecutive quarter at the start of 2013.

China, the global growth engine, has also been experiencing decelerating growth rates over the last few years, and the IMF recently downgraded its forecast for the country’s economic prospects.

Pimco’s founder and co-chief investment officer, Bill Gross, argued last month that central banks’ ultra low interest rate policies and ongoing bond-buying programs have resulted in a financial system that is “beginning to resemble a leukemia patient with New Age chemotherapy, desperately attempting to cure an economy that requires structural as opposed to monetary solutions.”

While the global central banks’ policies have stabilized economies, they haven’t succeeded in returning them to normal growth rates, said Gross, who manages the Pimco Total Return Fund.

CNNMoney.com
By Melanie Hicken
June 10, 2013

Seniors in almost every state in the country are falling short when it comes to affording their golden years, according to a study released Monday.

Nationwide, seniors are living off of a median household income of $35,107, roughly 57% of the median income of their younger counterparts ages 45 to 64, according to an analysis of 2011 U.S. Census Bureau data by Interest.com, a financial information website owned by Bankrate.com.

“We found that many senior citizens are significantly underfunded and risk running out of money,” said Mike Sante, the site’s managing editor.

Only seniors in Nevada and Hawaii have median annual incomes that meet the savings benchmark commonly recommended by financial planners. Typically, planners recommend that retirees save enough to replace at least 70% of their pre-retirement income.

Other states where seniors came close to that goal include the sunbelt states of Arizona (68.1%), New Mexico (66.9%) and Florida (66.9%), according to the study, which divided the median household incomes for residents 65 and older by the incomes of those 45- to 64-years old in each state to come up with income “replacement rates” for seniors.

In contrast, Massachusetts seniors were the worst off, living on a meager 45% of the income of their pre-retirement counterparts, while North Dakota, Rhode Island, New Jersey and New Hampshire rounded out the bottom of the list, all with replacement rates of around 50%.

Even seniors in top-ranking Nevada aren’t that much better off, since lower wages earned by younger workers pushed their replacement rate up. In Hawaii, seniors’ incomes are boosted by the state’s strong union culture, which provides many retirees with the safety net of monthly pension checks, said Sante.

That’s not the case in most of the nation, where a growing number of seniors are losing the guarantee of monthly pension checks throughout retirement, Sante said. In recent decades, companies and government organizations have drastically scaled back pension benefits or replaced them with 401(k) plans. For many retirees, Social Security has become the primary source of income.

“They certainly don’t have enough for what we consider to be a safe and comfortable retirement,” Sante said.

According to the Social Security Administration, 53% of married couples and 74% of unmarried retirees receive at least 50% of their income from Social Security. And nearly a quarter of married couples and almost half of unmarried retirees rely on Social Security payments for at least 90% of income.

With an average monthly Social Security check of around $1,230 per month, seniors are receiving average annual payments that total just $14,760 a year.

Nearly 20 million seniors — or almost half of the elderly population –are living on incomes that put them precariously close to the poverty line, with women, blacks and Hispanics more likely to struggle financially in retirement, according to a recent report from the Economy Policy Institute.

“Most seniors live on modest retirement incomes, which often are barely adequate — and sometimes inadequate — to cover the costs of basic necessities,” authors Elise Gould and David Cooper wrote in the report.

Bloomberg.com
By Nicholas Larkin
By June 7, 2013

Gold traders are the most bullish since before the bear market began two months ago after a retreat in equities from an almost five-year high and a weakening dollar spurred demand for bullion.

Nineteen analysts surveyed by Bloomberg expect prices to rise next week, with eight bearish and six neutral, the largest proportion of bulls since March 22. Global stocks that rose to the highest since June 2008 on May 22 reached a six-week low yesterday amid mounting speculation about whether the Federal Reserve will taper stimulus. The U.S. Dollar Index, a measure against six currencies, slipped to the lowest in three months.

Weekly sales of gold held through exchange-traded products are poised for the second-lowest level since March after the value of holdings slumped by about $45 billion this year. The start of the bear market in April spurred a surge in demand for coins and jewelry, with the U.S. Mint saying June 5 that its sales may be a record this year. Demand has been so great inIndia, the biggest buyer, that the government is curbing imports to ease the nation’s current-account deficit.

“The concern is that we see stock markets come under pressure and then see an increase in risk aversion,” said Mark O’Byrne, the executive director of Dublin-based GoldCore Ltd., a brokerage that sells and stores bullion coins and bars. “Gold’s already had a correction, so people see value in the gold market. There has been significant technical damage done to gold and therefore it will take a period of time to recover.”

Gold Price

The metal fell 17 percent to $1,383.12 an ounce in London this year after climbing the past 12 years, and is trading 28 percent below the record $1,921.15 set in September 2011. The Standard & Poor’s GSCI gauge of 24 commodities dropped 2.4 percent since the start of January and the MSCI All-Country World Index (MXWD) of equities rose 7.4 percent. Treasuries lost 0.9 percent, a Bank of America Corp. index shows.

Gold retreated as some investors lost faith in the metal as a store of value and the U.S. economy improved. The Fed’s Beige Book showed June 5 that the economy expanded at a “modest to moderate” pace in 11 of 12 Fed districts. TheChicago Board Options Exchange Volatility Index (VIX) jumped 39 percent since mid-May and reached a seven-week high June 5. The gauge of S&P 500 Index options prices is still 64 percent below its peak in 2011.

Hedge funds and other large speculators raised their net-long position, or bets on higher prices, by 35 percent in the week to May 28, the biggest jump in two months, U.S. Commodity Futures Trading Commission data show. Most of the increase came from a cut in short wagers from the previous week’s record.

Physical Demand

Physical demand surged around the world after prices slid to a two-year low of $1,321.95 on April 16. Gold and silver coin purchases from the U.S. Mint may reach a record this year if the current demand continues, Richard Peterson, its acting director, said in a June 5 interview. The mint sold 12,000 ounces of American Eagle gold coins this month, compared with 70,000 in May and 209,500 ounces in April.

Bullion for immediate delivery in China averaged about $31 more than the London price since mid-April. The premium had averaged about $7 in the previous 12 months, Shanghai Gold Exchange data show. Demand in India is poised for a quarterly record, the World Gold Council said May 29. Imports will be 300 to 400 metric tons in the period, almost half of last year’s total shipments, the London-based group estimates.

Indian Imports

India raised a duty on gold imports to 8 percent from 6 percent on June 5, following earlier moves to widen curbs on shipments that contributed to a $32.6 billion current-account gap in the fourth quarter. Imports may fall as much as 20 percent this year because of the higher levy, Bachhraj Bamalwa, a director at the All India Gems & Jewelery Trade Federation, said the same day.

Demand from speculators that helped push prices up as much as sevenfold in the past 12 years is waning. Taurus Funds Management Pty Ltd. shut its precious metals fund in May because of investor redemptions, said Gordon Galt, a principal at the Sydney-based fund manager.

Prices dropped in seven of the past eight months because the unprecedented money printing by central banks failed to increase inflation at a time when mounting optimism the global recovery is gaining momentum pushed U.S. equities to records last month. Fed Chairman Ben S. Bernanke said in May that the pace of quantitative easing could be reduced if the jobless rate keeps dropping.

Global Expansion

“The tail risks largely have been mitigated,” said London-based Warren Rogers, a fund manager at Duet Asset Management Ltd., which has been betting on lower prices. “You have the Fed telling you QE is over, you have a bull market in S&P 500. Of course the price can rally some, with so many shorts, but I think the broader path is quite down.”

Global economic expansion will accelerate in this and the following three quarters, according to economist estimates compiled by Bloomberg. Bullion may drop to $1,100 in a year, Credit Suisse Group AG forecast last month. Nouriel Roubini, professor of economics and international business at New York University, has forecast a decline toward $1,000 by 2015.

The 494.8 tons of gold that’s been sold from ETP (.GLDTONS)s this year now exceeds additions in the previous two years. This week’s sales of 11.09 tons follow 10.15 tons last week, the smallest since the end of March, data compiled by Bloomberg show.

Sugar Survey

In other commodities, eight of 15 people surveyed expect raw sugar to decline next week and three were neutral. The commodity slid 16 percent to 16.42 cents a pound on ICE Futures U.S. in New York this year.

Fourteen of 28 surveyed anticipate lower corn prices and 10 said the grain will gain, while 16 of 29 said soybeans will climb and nine expect lower prices. Twelve traders predicted declines in wheat and eight were bullish. Corn fell 20 percent to $5.55675 a bushel this year in Chicago. The December contract, which reflects supply after the U.S. harvest, is down 7.1 percent this year. Soybeans gained 8.6 percent to $15.3075 a bushel, as wheat declined 11 percent to $6.96 a bushel.

Six traders and analysts surveyed expect copper to rise next week, five were bearish and four were neutral. The metal for delivery in three months, the London Metal Exchange’s benchmark contract, slipped 8.8 percent to $7,230 a ton since the start of January.

The S&P GSCI gauge lagged behind equities for six months, the longest stretch since 1998. Diverging prices for raw materials and other “risk assets” is a sign that traders will once more focus on supply and demand, said Scott Kerson, the head of a commodities unit at Man Group Plc in London.

Domestic Consumption

Most commodities will drop this year as China’s economy moves from a focus on infrastructure to domestic consumption and services, Citigroup Inc. said in a May 20 report.

“In the last few years commodity prices have been buoyant not because of general global economic prosperity, but more to do with specifically Chinese industrialization,” said Carole Ferguson, an analyst at SP Angel Corporate Finance LLP, a broker and adviser in London. “Once things do settle and people have a clearer picture of what’s happening on the demand side, that’s going to give you a more fundamental outlook for the market.”

Mineweb
By Dorothy Kosich
June 3, 2013

Sales of the American Eagle silver bullion coins remain on track to set a new annual record this year. May sales, however, were down more than 15% from April.

Meanwhile, May sales of American Eagle gold bullion coins fell nearly 67% from April, U.S. Mint figures showed as of Sunday.

May sales of American Eagle one-ounce gold bullion coin sales were 61,000 ounces in May, up from 49,000 ounces in May 2012. However, American Eagle one-ounce gold bullion coin sales soared to a total of 187,500 ounces in April 2013.

Total American Eagle gold bullion coin sales of all denominations for May 2013 were 70,000 ounces, up from a total of 53,000 ounces for May 2012. Total gold sales for the first five months of this year are reported at 572,000 ounces.

Sales of the American Eagle silver coins were a total 3,458,500 ounces in May 2013, up from 2,875,000 ounces in May 2012. However, May silver bullion coins sales declined from total April 2013 sales of 4,087,000 ounces.

Total year-to-date sales for the American Eagle silver bullion coins were 21,768,500 at the end of May.

Meanwhile, May sales of the America the Beautiful five-ounce silver bullion coins totaled at 25,800 coins. The first of the 2013 coins did not launch until May 13th.

Kitco.com
By Jim Wyckoff
June 3, 2013

(Kitco News) – Comex gold futures prices ended the U.S. day session with solid gains on short covering and some bargain hunting as the U.S. dollar index took a nose-dive and hit a three-week low Monday. Comex August gold last traded up $18.80 at $1,412.00 an ounce. Spot gold was last quoted up $23.80 at $1,412.50. July Comex silver last traded up $0.502 at $22.745 an ounce.

The U.S. dollar index was under modest pressure in overnight trading, but then accelerated to the downside when some weaker-than-expected U.S. manufacturing data was released at mid-morning Monday. The slide in the greenback prompted traders and investors to do some perceived value buying in gold, and also prompted many of the shorts to exit their positions.

The much-anticipated economic data from China over the weekend was a mixed bag for traders and investors. China’s official purchasing managers’ index rose to 50.8 in May versus 50.6 in April, which was higher than expectations. However, the HSBC China manufacturing PMI fell to 49.2 in May compared to 50.4 in April. Chinese stock markets weakened on the fresh economic data, but other markets saw little impact from the data.

Japan’s stock market fell sharply again in overnight trading as it appears the major bull run in the Nikkei stock index has ended. The Nikkei has dropped by 17% in less than two weeks’ time. Many are wondering if the Nikkei is a leading indicator of how the U.S. stock indexes will fare in the coming weeks. If the other world stock markets do start to back down from their recent rallies, that would be a bullish factor for gold, silver and other asset classes.

The Euro zone’s manufacturing sector activity fell at its slowest pace in more than one year in May, it was reported Monday. The Euro zone PMI rose to 48.3 in May from 46.7 in April. Any PMI reading below 50.0 suggests contraction. The decrease in the rate of decline in the PMI did hint the Euro zone economy has bottomed out and could be on the rebound.

Traders and investors will get some major economic news later this week when the European Central Bank holds its monthly meeting on Thursday, followed by Friday’s U.S. employment report.

Reports of good demand for physical gold are also supporting the yellow metal. News reports Monday said the Indian government could implement further measures to reduce what has been strong consumer demand for gold in recent weeks.

The London P.M. gold fixing is $1,402.50 versus the previous P.M. fixing of $1,394.50.

Technically, August gold futures prices closed nearer the session high Monday. The gold bears still have the overall near-term technical advantage as trading has again turned choppy. Prices are still in a 7.5-month-old downtrend on the daily bar chart. However, more gains in the near term would produce a bullish double-bottom reversal pattern on the daily bar chart. The gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at $1,450.00. Bears’ next near-term downside breakout price objective is closing prices below solid technical support at last week’s low of $1,372.80. First resistance is seen at Monday’s high of $1,416.50 and then at last week’s high of $1,421.60. First support is seen at $1,400.00 and then at Monday’s low of $1,388.30. Wyckoff’s Market Rating: 3.5

July silver futures closed nearer the session high Monday and were also boosted by short covering and a slumping U.S. dollar index. Silver bears still have the overall near-term technical advantage. Prices are in a 7.5-month-old downtrend on the daily bar chart. Bulls’ next upside price breakout objective is closing prices above solid technical resistance at $23.29 an ounce. The next downside price breakout objective for the bears is closing prices below solid technical support at $22.00. First resistance is seen at Monday’s high of $22.915 and then at last week’s high of $23.06. Next support is seen at $22.50 and then at Monday’s low of $22.175. Wyckoff’s Market Rating: 3.5.

July N.Y. copper closed up 355 points at 332.80 cents Monday. Prices closed nearer the session high on short covering. A lower U.S. dollar index was also supportive for copper today. Copper bulls and bears are on a level near-term technical playing field. Copper bulls’ next upside breakout objective is pushing and closing prices above solid technical resistance at the May high of 341.80 cents. The next downside price breakout objective for the bears is closing prices below solid technical support at 322.40 cents. First resistance is seen at Monday’s high of 334.75 cents and then at 337.50 cents. First support is seen at 330.00 cents and then at Monday’s low of 328.10 cents.

Bloomberg.com
By Joe Richter
June 3, 2013

Hedge funds raised bets on a gold rally by the most in two months as the U.S. economy expanded less than previously estimated, boosting speculation the Federal Reserve will maintain the pace of stimulus.

Speculators raised their net-long position by 35 percent to 48,096 futures and options by May 28, the biggest gain since March 19, U.S. Commodity Futures Trading Commission data show. Most of the gain came from a drop in short bets, which reached a record a week earlier. Net-bullish wagers across 18 U.S.-traded commodities climbed 13 percent to a nine-week high of 652,708 contracts, led by gains in corn and natural gas.

The U.S. economy grew at a 2.4 percent annualized rate in the first quarter, the Commerce Department said May 30, cutting its previous estimate of 2.5 percent. Fed Chairman Ben S. Bernanke said May 22 that ending the central bank’s stimulus program prematurely could endanger the recovery. Bullion surged 60 percent since the end of 2008 as central banks printed money on an unprecedented scale to boost growth.

“Gold continues to be useful as an insurance policy in people’s portfolios to guard against uncertainty and possibly some economic dislocation,” said Michael Cuggino, who manages about $14 billion of assets at Permanent Portfolio Family of Funds Inc. in San Francisco. “You have a lot of monetary creation going on, and while inflation is not a current threat, that doesn’t mean it’s not a threat at some point.”

May Returns

Gold futures rose 0.4 percent last week, for a second weekly gain. The Standard & Poor’s GSCI Spot Index of 24 commodities fell 1.4 percent, the most in six weeks. The MSCI All-Country World of equities dropped 1.4 percent, while the dollar weakened 0.4 percent against six major trading partners. A Bank of America Corp. index shows Treasuries lost 0.7 percent.

Bankers advising the Fed said they expect the record stimulus to last as long as three years, according to minutes of a May 17 meeting released last week. The Fed is buying $85 billion of assets a month. Japan is making monthly bond purchases of more than 7 trillion yen ($69.7 billion).

Demand in India, the world’s largest bullion buyer, is poised for a quarterly record as imports reach 300 to 400 metric tons, the World Gold Council said May 29. That’s equal to almost half last year’s total purchases. The U.S. Mint’s sales of American Eagle gold coins reached 70,000 ounces last month, 32 percent more than a year earlier. Sales doubled in the first five months of 2013.

Divided Outlook

Traders are divided in their outlook for prices, with 15 analysts surveyed by Bloomberg expecting the metal to rise this week. Thirteen were bearish, and five neutral. Investors cut their short holdings by 10 percent to 71,311 contracts, the biggest drop since March 19.

Short wagers may keep declining after prices rallied 2.3 percent in the two days after the cut-off date for the CFTC data. A drop in contracts outstanding on the Comex also “likely reflects bouts of short covering,” Edel Tully and Joni Teves of UBS AG said in a report. Gold open interest dropped more than 8 percent last month, bourse data through May 30 show.

Holdings in exchange-traded products backed by gold retreated for a fifth month in May, dropping 5.6 percent to 2,148 tons, the lowest since May 2011. The value of the assets tumbled $44.2 billion this year as some investors lost faith in the metal as a store of value. BillionaireGeorge Soros joined funds managed by Northern Trust Corp. and BlackRock Inc. in cuttingholdings of ETPs in the first quarter, filings with the Securities & Exchange Commission show.

Decade Long

“Physical demand for gold has been good, but it hasn’t been enough to offset the losses coming out of ETFs,” said Timothy Hoyle, the director of research at Radnor, Pennsylvania-based Haverford Investments, which oversees about $6 billion of assets. “Gold has been in a decade-long bull market, and I could see gold continue to tread water for a while now or even trade down. Things really need to go wrong in the economy for gold to go up.”

Investors pulled $1.03 billion from gold funds in the week ended May 29, according to Cameron Brandt, the director of research for Cambridge, Massachusetts-based EPFR Global, which tracks money flows. Total outflows from commodity funds were $1.24 billion, according to EPFR.

Wagers on a rally in crude oil dropped 6.2 percent to 217,531 contracts, the first decline since April 23, the CFTC data show. Platinum holdings fell for a second week to 18,873 contracts, the lowest since August. Bets on higher cotton prices tumbled 21 percent, the most since investors were net short in November.

Monetary Fund

The funds trimmed their net-short position in copper to 8,872 contracts from 9,033 a week earlier. Speculators have been betting on a decline since the end of February. Prices in New York dropped 8.8 percent this year on signs that supplies will exceed demand. The International Monetary Fund on May 29 cut its forecast for expansion this year and next in China, the world’s biggest consumer of commodities from cotton to soybeans to zinc.

A measure of net-long positions across 11 agricultural products gained 28 percent to 293,716 contracts, paring this year’s drop to 27 percent. The S&P Agriculture Index of eight commodities declined 4.5 percent since the start of January.

“As long as the economic growth picture in China and Europe remains in question, we think there’s not a compelling case for commodities,” said Jim Russell, a senior equity strategist in Cincinnati at U.S. Bank Wealth Management, which oversees about $110 billion in assets. “We view it as a macro-economic supply-demand type dynamic, and right now it feels like the demand is maybe slipping away a little.”

Bloomberg.com
By Debarati Roy
May 30, 2013

Gold futures rallied the most in a week on speculation that the Federal Reserve will maintain bond purchases to bolster the U.S. economy, boosting demand for the precious metal as a store of value. Silver also rose.

U.S. gross domestic product expanded at a 2.4 percent annualized rate in the first quarter, the Commerce Department said today. The median forecast in a Bloomberg survey called for no revision from the 2.5 percent pace initially reported. Initial jobless claims rose 10,000 to 354,000, above the 340,000 forecast. The dollar fell for a second day against a basket of currencies

“Today’s data is an indication that the economy has not fully recovered, and so the Fed will not end its stimulus in a hurry,” Phil Streible, a senior commodity broker at R.J. O’Brien & Associates in Chicago, said in a telephone interview. “Also, a weaker dollar helps.”

Gold futures for August delivery advanced 1.4 percent to $1,411.90 an ounce at 9:35 a.m. on the Comex in New York, heading for the biggest gain since May 23.

Trading was 49 percent higher than the average for the past 100 days at this time of day, according to data compiled by Bloomberg.

Fed Chairman Ben S. Bernanke said May 22 that the central bank may slow its $85 billion of monthly debt purchases if the economy shows sustained signs of improvement.
Gold dropped 17 percent this year through yesterday and entered a bear market last month as equities rallied, the dollar strengthened and amid concern that the Fed may slow the pace of its stimulus measures.

Silver futures climbed 1.8 percent to $22.82 an ounce in New York, heading for the biggest increase since May 2.

Kitco News
By Jim Wyckoff
May 30, 2013

(Kitco News) – Comex gold futures are posting solid gains in mid-morning trading Thursday, extending modest early gains. Some tepid U.S. economic data released in the morning worked to pressure the greenback, which in turn boosted gold prices. Some safe-haven demand is also seen in the gold market Thursday, following a sharp sell- off in the Japanese stock market overnight. Short covering and technically related buying are also seen Thursday as the bulls have now gained a bit of fresh upside technical momentum. August gold last traded up $23.00 an ounce at $1,414.70.

DailyFinance.com
by Justin Loiseu
May 24, 2013

Following Federal Reserve Chairman Ben Bernanke’s testimony to Congress on Wednesday, the bulls and bears of Wall Street went wild. But look past the market movements and more statistics than you can shake a stick at, and you’ll see that the chairman managed to sum up the state of our economy with three important macroeconomic indicators.

Here are the key numbers you need to watch.

1. GDP growth rate
Gross domestic product is the leanest, meanest indicator of economic health. It crams consumption, government spending, investment, and net exports into one number.

In his testimony, Bernanke cited GDP as evidence for the economy’s “moderate pace” of growth. For the first quarter of 2013, real GDP clocked in at an annual rate of 2.5 percent, an impressive increase over 2012′s 1.75 percent rate.

But as Congressman Kevin Brady (R-Texas, chairman of the Joint Economic Committee) noted in his opening remarks: “We’re experiencing the worst economic recovery since WWII. The growth gap between this recovery and an average post-war recovery is large and growing.”

Brady alluded to a “new normal” where long-term growth rates ooze along, and he pointed to GDP growth rate estimates as evidence of this trend. GDP might be up 2.5 percent, but the Congressional Budget Office recently reduced its estimates from 3.2 percent to 2.2 percent. From that perspective, our economic outlook is falling fast.

2. Employment
GDP provides us with the big picture, but employment gives investors an inside look into how Mr. and Mrs. Jones are managing. In the labor market, messages are mixed.

Both Bernanke and committee members were quick to point to a drop in the unemployment rate as a beacon of hope. In the last year, the unemployment rate has dropped more than half a percent to 7.5 percent for April 2013 — a substantial improvement. “In all, payroll employment has now expanded by about 6 million jobs since its low point, and the unemployment rate has fallen 2.5 percentage points since its peak,” Chairman Bernanke noted.

But a closer inspection sheds some light in several dark corners. Unemployment rates are well above long-run levels, Americans are remaining unemployed for longer, and a substantial portion of our “willing to work” population has abandoned the job hunt altogether.

GDP growth rates might rise or fall from quarter to quarter, but a jobless “Joe Six Pack” can have devastating long-term effects on an economy. We’ve heard the message from across the pond, where France’s 10.6 percent unemployment rate and Spain’s 27.2 percent could leave these countries struggling for years to come.

America’s economy is no different.

3. Inflation
Finally, some good news (well, sort of…and just for now). A trillion-dollar increase in GDP or a $1,000 bonus don’t mean a thing if our money has less value, and the Federal Reserve seems to be making good on its inflationary mandate.

Over the past year, consumer price inflation is up just 1 percent, keeping prices affordable for cash-strapped customers. With fiscal 2012′s worrisome 2.25 percent increase behind us, things might be looking up. Bernanke estimates that “over the next few years,” rates will run at or below the 2 percent sweet spot to maximize employment while keeping costs steady.

But Bernanke’s books aren’t as balanced as one might hope. Although overall inflation eased up 1 percent, a 4.3 percent annual decline in energy prices was the main pull to inflation’s push. Excluding more volatile food and energy prices, inflation is up 1.7 percent over the last 12 months — dangerously close to the edge of the sweet spot.

And although Bernanke remains bullish on inflation control, Congressman Brady warned the chairman that the Fed’s excess reserves “could become the fuel for future inflation when economic growth accelerates, unless the Fed acts swiftly to contract its balance sheet.”

Scared yet?
Our economy is on the mend, but how fast and how effectively it’s recovering is up for debate. GDP, employment, and inflation control are all improving, but a closer inspection reveals the fragile roots of our recent recovery.

Moving forward, investors will need to keep a close eye on these indicators and their underlying meaning. Macro-based market movements are no replacement for fundamental analysis, but these numbers will keep you well informed as the U.S. economy (hopefully) continues to inch upward.