Thursday, May 21, 2009

GDP Declines Significantly in Mexico (and in Germany and Japan)

The Wall Street Journal reported today that the following annualized declines in first quarter GDP have been reported in the past two weeks:
  • Mexico: Minus 21.5%
  • Japan: Minus 15.2%
  • Germany: Minus 14.4%
The article points out that all three countries depend on exports to the US -- and US consumer demand has decreased significantly.

Mexico has a $47 billion credit line set up with the IMF.

228. Does Mexico's credit line mean that it is in danger of defaulting on its loans (ie, the Mexican equivalent of US Treasuries)?

Tourism in Mexico is taking (and is expected to continue to take) a major hit from the swine flu outbreak. Hotels in Cancun are running at 29% occupancy for the month of May.

229. Of all US consumer purchases, which one is taking the biggest hit during the recession? Flat screen TV's? SUV's? Granite countertops?

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