Benchmark Revisions in GDP Report a Game Changer
More vindication for those of you who have been saying that a "new" recession right now would merely be a continuation of the Great Recession:
- Q1 Revised down from up 1.9% to merely up 0.4%
- Revision shows GDP is actually still lower today than at start of Great Recession
- So, a "new" recession now would actually be a technical "Double Dip" of same recession
- Contraction from Great Recession was markedly deeper than earlier estimated
- Benchmark revision shows that current annual GDP rate has fallen below the "2% Threshold"
- Consumption flatlined in second quarter
Calculated Risk
Real GDP still below Pre-Recession Peak
CNBC
Data Shows Deeper US Recession, Sharper Slowdown
The "Great Recession" was even greater than previously thought, and the U.S. economy has skated uncomfortably close to a new one this year.
New data on Friday showed the 2007-2009 U.S. recession was much more severe than prior measures had found, with economic output declining a cumulative of 5.1 percent instead of 4.1 percent.
The report also showed the current slowdown began earlier and has been deeper than previously thought, with growth in the first quarter advancing at only a 0.4 percent annual pace.
The data indicated the economy began slowing in the fourth quarter of last year before high gasoline prices and supply chain disruptions from Japan's earthquake had hit, suggesting the weakness is more fundamental and less temporary than economists had believed...
"The general picture of the recession remains pretty much the same, it was a record decline before and now it is a even bigger decline," Steven Landefeld, the director of the department's Bureau of Economic Analysis, told reporters...
CNN
Economy grinds to halt as consumers pull back
NEW YORK (CNNMoney) -- Consumers all but shut their wallets in the second quarter, causing the U.S. economy to grow at a tepid pace.
To make matters worse, growth in the first quarter was much slower than initially thought, according to new government figures released Friday.
"It's quite worrisome as the economy remains at stall speed in the second quarter," said Sal Guatieri, senior economist with BMO Capital Markets. "If that continues, then it would raise the risks of a double dip." ...