The GDP Report

[Valin]

Contentions:

John Steele Gordon

10/26/12

 

The Commerce Department this morning gave a reading on the third-quarter 2012 Gross Domestic Product—the sum of goods and services produced in the United States. GDP climbed 2 percent (on an annualized basis) in July, August, and September, slightly above the predictions of economists. This was an improvement on the dismal 1.3 percent growth the economy saw in the second quarter, but still a long way from the sort of robust recovery that is needed to significantly bring down the unemployment rate and restore a sense of prosperity to the country.

 

Much of the growth was in consumer spending, especially for durable goods (such as automobiles, refrigerators, etc.), which saw growth at 8.5 percent. But business investment remained weak, with fixed investments (buildings and equipment, for instance) actually declining 1.3 percent after climbing 3.6 percent in the second quarter. This might reflect caution ahead of the election and fear that the “fiscal cliff” of tax hikes and government spending cuts due January 1 might actually come to pass. Most economists think that that would send the economy right back into full-blown recession.

 

 

Exports shrank, reflecting the deepening economic problems in Europe. Imports also fell, but at a lower rate. Federal government spending also accelerated in the quarter

 

(Snip)

 

[Valin]

Average GDP Growth Less than Half of What Obama Predicted

DANIEL HALPER

10/26/12

 

The average GDP growth for the first three quarters of this year is 1.77 percent, according to data released by the the Bureau of Economic Analysis this morning. That is less than half of what the White House predicted GDP growth would be this year, and less than a third of what the Obama administration projected when it first took office.

 

Here's a chart from the Republican-side of the Senate Budget Committee, detailing real GDP growth numbers versus those predicted by the White House:

 

 

(Snip)

 

 

Just another Bump In The Road.