Advance GDP estimate for second quarter revised down from 2.4% to 1.6%
This is a GDP number that is down 55 percent from the first quarter. Will Vice President Joe Biden’s Summer of Recovery tour be canceled, or will he just change up the play list? Has the Associated Press displayed their bias with the first paragraph re-write of the GDP numbers story?
From the Bureau of Economic Analysis website about 20 minutes ago…
Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 1.6 percent in the second quarter of 2010, (that is, from the first quarter to the second quarter), according to the “second” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP increased 3.7 percent.
The GDP estimates released today are based on more complete source data than were available for the “advance” estimate issued last month. In the advance estimate, the increase in real GDP was 2.4 percent (see “Revisions” on page 3).
The increase in real GDP in the second quarter primarily reflected positive contributions from nonresidential fixed investment, personal consumption expenditures, exports, federal government spending, private inventory investment, and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.
The deceleration in real GDP in the second quarter primarily reflected a sharp acceleration in imports and a sharp deceleration in private inventory investment that were partly offset by an upturn in residential fixed investment, an acceleration in nonresidential fixed investment, an upturn in state and local government spending, and an acceleration in federal government spending.
No real time to search out commentary on the results, but Ed Morrissey at Hot Air notes…
[R]eal private-sector growth simply isn’t happening. Government can’t spend its way into real economic expansion, as we have seen every 35 years or so in the US.
He also writes about how – and if – the media spin-masters on the left will handle the news, and points out an AP story on the CBS News website. Well, I think I’ve already figured out how some in the media will spin the story. Ed’s post has a clip from what I’m thinking is the original AP story.
The government is about to confirm what many people have felt for some time: The economy barely has a pulse.
That first sentence of the story seems to have been scrubbed for the following. They revised the paragraph from “barely has a pulse” to “barely-moving.”
The government has sharply cut its estimate of U.S. economic growth in the second quarter, adding fuel to worries about the barely-moving economy.
OK … just went back and confirmed. I could not find a screen shot of the original CBS News post Morrissey linked to, but I did find the AP story – with the original first paragraph over at Edge Boston.
Original AP Story (sorry, please click for full size)
Revised first paragraph of AP story on the CBS News website.
Am I reading too much into this? Remember, the AP article is not a commentary, rather supposedly a hard-news outlet feeding out news to many different organizations.
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The decision-makers of all stripes are in denial about the state of the economy. But even liberals like Krugman (see today's Times) say that things need to be shaken up. The decision-makers: President, Congress, the Fed, even the businessmen sitting on oodles of cash, are afraid of the consequences of doing something. So the rest of us suffer, they don't.
Doing something for the sake of doing something can sometimes be worse than doing nothing.
Just another Harvard grad throwing his own feces at people staring at him in disbelief.
As usual the right sounds the alarm about bad economic news. The growth is still positive unlike a recession which is defined with negative growth. Tomorrow they might have news about some positive economic indicators which will be conveniently ignored by the right. I heard on the radio yesterday that there were fewer claims for unemployment last week. Why not mention that? Is it because you want to focus on the negative to get Republicans elected? I doubt you posted all of the negative numbers before the 2008 election.
I think the "captains" of industry are sitting on their collective "as..es". They are waiting for "certitude". They have to learn to work w/ what is in place and stop looking in the rear-view mirror.
They are not looking in the rear-view mirror at all, it's the total uncertainty of what is coming around the next bend. VAT, health care expenses, amnesty, cap and trade, … How the heck do you expect any business to plan for the future with the power (unconstitutionally) centralized within the beltway by power-hungry politicians from both parties?
Steve…are you reading into this too much? Maybe. Although, in my opinion,"barely has a pulse" much more accurately describes this economy, "barely moving" is still commentary and does not improve the rhetoric much. No matter how you describe it, this economy is not growing at a pace that can support itself, and notice that a portion of that growth is still coming from gov't spending.
sammy22….Agreed. However, looking FORWARD at the uncertainty of tax increases, a VAT tax, new regulatory requirements, and even the prospect of NEW fees and taxes on business is certainly adding to the stagnation and lack of "certitude".
Come on guys. It's called planning and risk assessment. Of course there is uncertainty, and you construct different scenarios. I call it leading, but then these days CEOs are hiring a Chief of Staff, just like the "biggies" in government, so they get a filtered reality.
Putting "all" the blame on what goes on inside the Beltway is scapegoating. And please, worry about a VAT or new regulations?
A VAT has been seriously discussed by Obama's deficit commission and by numerous "experts" and representatives.
http://www.foxnews.com/opinion/2010/04/09/andrea-…
http://www.cbsnews.com/8301-503983_162-20001918-5…
http://washingtonindependent.com/82035/with-vat-t…
NEED MORE??? It was a very simple Google.
New regulations you say?
Cap and Tax and Card Check in a lame duck session.
Buy your goods now folks. Here comes the largest tax increase EVAH.
scottm
"As usual the right sounds the alarm about bad economic news."
As usual the left chimes in with nothing but insults and slander to further their own political game. You know what'd be nice in this "barely moving" economy that scott thinks is doing so well?
Actual recovery!!!! OMG!!!
Not sure how your doing over there buddy, I however can attest to having made less money this past year than any year previous to it. So I'm not sure how anyone can look at these numbers,BARELY positive or otherwise and actually defend what the left is doing to this country.
Explain to me again how cutting taxes for everyone across the board wouldn't jump start the economy? What was that, how do you pay for tax cuts you say? Well I know in my house when we want to save more money we STOP SPENDING! Problem solved.
We miss you "Dubba."
And Steve, I don't think your reading too much into it, I find it extremely sad that the media thinks they need to cover up for this president's policies and blunders. It's time to pull back the curtain and show "Dorothy" who the "wizard" really is.
Personally I do not sweat too much about things that are being "discussed/studied". For example, all the discussions about a flat tax have produced nothing other than nausea. I might get a little more interested when things get proposed as legislation. But then I would rely on those leeches, known as lobbyists, to influence the legislators appropriately.
When you run a business you have a long term plan. Unfortunately the government plans only for the next election that is where the conflict arises. Would you jump into a river without testing the water? You have to make a profit to stay in business. there is nothing wrong in making money
Socailenemy, I don't consider the economy rosy, what I'm saying is that by focusing on the negative and ignoring positive signs the right is trying to scare people which in turn hurts the economy more. They are afraid the economy will start to rebound before the election and cost them seats.
"…focusing on the negative and ignoring positive signs XXX is trying to scare people which in turn hurts the economy more. They are afraid the economy will start to rebound before the election and cost them seats."
That sounds soooo familiar!
I would be happy if they would actually discuss these things, particularly something as onerous and debilitating as a VAT, but the likely scenario will be a repeat of the last major legislative assaults: rush, rush, rush! No time to read the bill! Dive, dive, dive!! Then it will open the doors for our vaunted "representatives" to once again avoid their responsibility to read the bill and consider the implications.
Then, as in Øbamacare and the "stimulus" bill, it will be another grand case of "hurry up and wait".
@Sammy:
"Planning and risk assessment" affects small businesses as well. Being hung-up on the thought that is all "big business" who worries about policies is very short sighted. As an owner of a small S-Corp, everything affects my company as badly as a Microsoft, Alcoa, etc. We don't look in the rear-view mirror, we tossed it away long ago. We can only plan with what has been put upon us and as no one has a crystal ball to predict what will happen we sit tight, hold our cash, do not hire, do not purchase new equipment or technology. Stagnation!
And, as for the GDP being positive…aaah, no, 1.6% 2nd Q is not positive when it is less than the 3.7% 1stQ. That is going down. I only hope, like everyone here, that this is short-lived. We don't want this as some sort of vengeance towards this administration but, we see the policies set as retarding growth, not advancing.
I know things are getting bad when even Dimsdale waxes scatological (third comment from top) 🙂
Sorry, Jolly! That was meant for the Alan Grayson post! LOL!
Of course, there is a benefit to going to 1.6% from 2.4%: several months of 1.7 – 2.0% GDP estimates will look like gains!! 😉