The latest in the search for "green shoots" has focused on the consumer data in the GDP report and other economic releases. I urge caution because:
1. On April 1, 2009 there were 2.1 million fewer people working than on January 1, 2009.
2. Data for the last 2 IRS tax seasons indicates that 80.39% of tax refunds are processed in the first 3 months of the year. Obviously April is a big month as well, but that is it for the 2nd quarter's kicker.
3. According to the CPI Index, average prices were lower in the 1st quarter of 2009 than in the 4th quarter of 2008. Remember the discounting by struggling and folding retailers?
4. Consumers rushed to charge purchases before credit lines and home equity lines were pulled. Remember the stories about banks paying customers to close home equity lines? Also review the following: http://www.reuters.com/article/newsOne/idUSTRE4B01HI20081201
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