Gross Domestic Product Growth (3Q11), December Revision: An Annualized 1.8%, Down From 2.0% (Update: Private Sector GDP STILL Smaller Than Before Recession Began)
(Carried forward from original post time just before the report’s release. An updated comparison of the Reagan-era recovery compared to the current “recovery” is at right. Also, see Updates below)
The original estimate for third-quarter 2011 growth in Gross Domestic Product was an annualized 2.5%.
That was revised downward to 2.0% in November.
So what will happen today?
The report will be here at 8:30 a.m.
HERE IT IS — Down she goes, yet again (full release here):
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 1.8 percent in the third quarter of 2011 (that is, from the second quarter to the third quarter), according to the “third” estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 1.3 percent.
… The increase in real GDP in the third quarter primarily reflected positive contributions from nonresidential fixed investment, personal consumption expenditures (PCE), exports, and federal government spending that were partly offset by negative contributions from private inventory investment and state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased.
The acceleration in real GDP in the third quarter primarily reflected accelerations in PCE, in nonresidential fixed investment, and in exports, and a smaller decrease in state and local government spending that were partly offset by a larger decrease in private inventory investment.
Expect media reporting to be dominated by the following: “Yeah, but the fourth quarter will be 3% or more. It really, really will be. Please believe us.”
UPDATE: Growth during the first three quarter of 2011 has averaged less than 1.2%. Pathetic — and for those who remain unemployed, underemployed, and on the sidelines in withdrawal, tragic.
UPDATE 2: The private sector is STILL smaller than it was at the end of 2007, the quarter-end just after when the National Bureau of Economic Research says the recession began. It’s also now smaller than it was during the second quarter of 2008, when the recession as normal people define it began. The economy as a whole is just barely larger by either definition. Here’s the related info (in billions of 2005 chained dollars):
Thus, nine quarters after the recession’s end (regardless of when you think it began), it is still quite fair for those in the private sector to ask: “Rebound? What Rebound?“