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The worst U.S. economic slump since the Great Depression abated in the second quarter as government spending programs started to kick in, while the sharpest pullback by consumers since 1980 augured a muted recovery.

Gross domestic product shrank at a better-than-forecast 1 percent annual pace after a 6.4 percent drop the prior three months, Commerce Department figures showed yesterday in Washington. A survey of purchasing managers showed separately that business contracted less than estimated in July.

Consumer spending, which accounts for about 70 percent of the economy, fell at a 1.2 percent pace following a 0.6 percent increase in the prior quarter. It was forecast to drop 0.5 percent, according to the survey median. Purchases slid 2 percent since the peak at the end of 2007 — the most since a 2.4 percent decline in the 1980 recession.

Source: bloomberg.com

Sales of U.S. previously owned homes fell in March after jumping a month earlier by the most in more than five years. Purchases decreased 3 percent to an annual rate of 4.57 million, lower than forecast, from 4.71 million in February.

Record-low mortgage rates and a foreclosure-driven plunge in prices are making houses more affordable, helping the market stabilize following the biggest slump since the Great Depression.

Mike Mayo, a CLSA analyst, just assigned an “underweight” rating to U.S. banks and predicted loan losses will exceed levels from the Great Depression. This means that he predicts that there will be more credit trouble, including credit card problems. This might happen to you too. So if you have bad credit rating or bad credit loans, you can visit BadCreditOffers.com to find best offers, like credit cards for bad credit, home loans, auto loans, personal loans that fit your needs. You can also learn how to repair your bad credit cards and consolidate your debt by moving it into one low payment. By doing debt consolidation, you can reduce your loan payments and this will benefit both you and the lender. You can consider BadCreditOffers.com is a one stop solution for your bad credit history.

Mike Mayo, who left Deutsche Bank AG last month and joined CLSA, assigned an “underweight” rating to U.S. banks and predicted loan losses will exceed levels from the Great Depression. After Mayo gave “sell” ratings to banks U.S. stocks dropped. Bank of America Corp. and JPMorgan Chase & Co., the two biggest U.S. banks by assets, were assigned “underperform” ratings, Mayo said in a report today.