“Australian businesses grew less optimistic about near-term prospects, signaling a slowdown in the fastest-growing developed economy that economists predict will force the central bank to cut interest rates again.

The business conditions index for the next three months dropped to 5, the lowest reading since the second quarter of 2009, National Australia Bank Ltd. (NAB) said in a survey released today. The second-quarter confidence index slipped to minus 2, the lowest since the third quarter last year, it showed.”

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“Federal Reserve Chairman Ben Bernanke spent a second day testifying before Congress on monetary policy and the U.S. economy.

Bernanke’s prepared testimony before the House Financial Services Committee on Wednesday was virtually identical to his presentation to the Senate Banking Committee on Tuesday.

Here are some highlights from the question and answer session during Wednesday’s hearing.”

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The Beige book said the economy grew modestly in June.

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“The mainstream consensus has lately been that the economy is slowing. Based on my tracking of federal revenues in real time, I suspect that that view is incorrect. Instead the recent data reflects only normal oscillations within the ongoing slow growth trend.

Total federal tax collections, including withholding taxes, are available to us with just a one day lag in the US Treasury’s Daily Treasury Statements, which makes them an excellent analytical resource. Withholding is mostly for compensation, and thus it is a good measure of the economy’s strength. However, it is extremely volatile day to day so I rely more on a monthly moving average of the 10 day total collections, comparing that with the prior year. Smoothing sacrifices a bit of timeliness to get a clearer picture of the trend without losing too much of the edge that the daily data provides. Unfortunately, I have found even the 10 day total data too noisy for meaningful comparison so I’ve had to resort to additional smoothing. As a result the smoothed data is a little slow, so I also look at raw month to date data after mid month.

As of July 11, the 4 week average of the 10 day total of withholding taxes is now up 4.0%..”

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“Treasury Secretary Timothy Geithner said the economy is “definitely slower,” but defended the Obama administration’s actions and said Washington needs to take aggressive action to promote growth.

CNBC.com Treasury Secretary Timothy Geithner

Speaking at the “Delivering Alpha” conference presented by CNBC andInstitutional Investor, Geithner rejected the idea that the economy is headed for another recession.

“What the economy needs right now is very substantial and well-designed program for support of economic growth,” Geithner said in a live interview.

He said Congress ought to continue payroll tax cuts for “98 percent” of American workers and make mortgage refinancing more readily available, among other proposals.”

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Cheers on cheap energy….as of late.

Full article with chart porn

Is this a pause for the consumer or a shift in consumer spending ?

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“According to Al Lewis on The News Hub, we’re actually in a depression right now, but most people don’t see it. One out of seven Americans are on food stamps – if they weren’t getting cards in the mail every month, you’d see them in soup lines.”

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“U.S. economic growth might not even break 1 percent in the third quarter of this year, which would put the country at stall speed and in danger of petering out, says New York University economist Nouriel Roubini.”

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Calling all ‘preppers’; get ready to bug out…lol

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Infrastructure projects are a good way to place hidden stimulus into your economy. China will make new railway investments as they forecast a pick up in economic activity. Markets rallied on the news.

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“Economists say the sales and profit gains of early this year are disappearing, and they are increasingly pessimistic about short-term growth.

They also are gloomy because of the potential impact in the U.S. from Europe’s financial crisis, the possible expiration of the Bush tax cuts in December, and the prospect of major cuts in federal spending.

A survey by the National Association for Business Economics released Monday also found less evidence of hiring, confirming the trend in recent monthly jobs reports from the government.”

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“The ISI Company Survey (conducted by the ISI Group) is a weekly corporate activity indicator, covering some 300 firms. See this document for information on the index methodology.

The overall ISI Index had a significant drop this week from 50.4 to 49.3, the largest one week drop in 18 months. This does not bode well for earnings going forward.”

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“Stocks are poised for a correction that could take them down more than 5 percent, says the normally bullish David Bianco, U.S. equity strategist for Deutsche Bank.

The economy stagnated during the middle of 2010 and 2011 just like it is this year, Bianco writes in his monthly report, obtained by Business Insider.

The stagnation triggered a slump for stocks in each of the past two years, with the Standard & Poor’s 500 Index falling 16 percent during the stagnation of 2010 and 19 percent in 2011.”

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Read at your own risk. May cause the hopium feeling to dissipate quickly and leave you feeling in despair.

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More on the subject 

“China’s growth slowed for a sixth quarter to the weakest pace since the global financial crisis, putting pressure on Premier Wen Jiabao to boost stimulus to secure a second-half economic rebound.

Gross domestic product expanded 7.6 percent last quarter from a year earlier, the National Bureau of Statistics said today in Beijing. The pace, a three-year low, compares with an 8.1 percent gain in the previous period and the 7.7 percent median forecast of economists. Industrial production increased at a slower pace in June while retail sales growth decelerated.”

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Hat Tip: @StockSage1 on Twitter

“IRWIN, Pa. – About 20 miles east of Pittsburgh, the former heart of the nation’s steel industry, a small company called ExOne is churning out a new generation of stainless steel boat propellers, oil pump parts and door knobs.

But there are no clanging hammers, wheezing presses or even computer-controlled milling machines.

Instead, a dozen 3-D printers quietly stitch together industrial parts by meticulously spreading hundreds or thousands of layers of powdered metal onto a canvas until they form three-dimensional shapes.”

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Consumers in China can not get enough automobiles in their lives. Sales continue to be strong led by Honda.

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“Small business owners’ pessimism about the U.S. economy seems to be rising with temperature. For the second month in a row, the Small  Business Optimism Index declined, according to a monthly survey by the National Federation of Independent Business.

“Optimism fell off last year at the same time, but not like this,” said William Dunkelberg, chief economist for the NFIB. The index was down three points in June, after a one-tenth of a point decline in May.”

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