The clutch of data now available for July has strengthened expectations that GDP will rise in the current quarter by as much as 3%. An index of manufacturing activity rose to its highest level since last August, and manufacturers reported that new orders were growing briskly, the best in over two years. Car sales jumped 15% to an annualised 11.2m and manufacturers are ramping up production. Sales of existing houses have risen. Even battered Elkhart got some good news: on August 4th Dometic, a supplier of recreational-vehicle parts, said that with some help from local incentives it would add 240 jobs to its operation in the town.
Mr Obama and his aides have wasted no time in crediting the $787 billion fiscal stimulus for spurring this recovery. In fact the stimulus’s contribution so far has been relatively modest. More important was last autumn’s massive injection of public capital, loans and loan guarantees into the financial system, and this spring’s bank stress tests. These stopped the spiral of declining asset prices, credit withdrawals and bank failures that had threatened to turn a recession into a depression.