This is what it has come to: Growth in gross domestic product putt-putted along at a 2.6 percent annualized rate in the fourth quarter and the Wall Street Journal, the Bible of capitalism, pronounces it “solid.”
Solid GDP growth was the 4.1 percent seen in the third quarter. That’s the level needed to fill the hole in demand left by the Great Recession and start creating jobs at a decent rate. Unfortunately, it was not sustained (and the number was distorted by a buildup in inventories). Such a rate has been a rarity in the recovery — or as many Americans see it, “recovery.” Here’s how output growth stacks up against recoveries from the most severe recent downturns:
Some eighteen quarters after the official end of the Great Recession, and this upswing is still sub-par. In fact, it is the weakest seen among post-World War II recoveries. (You can compare all of them here).
Today’s report marks the government’s third revision to the data (the first forecast was 3.2 percent). It missed expectations. Personal consumption, rising at 3.3 percent, is being cited as the diamond in the mud of today’s report. Unfortunately, much of that is being sustained by debt. Wages remain stagnant at best for most.
Now, on to the first quarter report, where the weather can be blamed for a continuing dismal recovery.
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Today’s Econ Haiku:
Charlotte’s mayor jailed
But Charlotte’s bankers went free
Wolves of Tryon Street