Best economic growth in six years

Best economic growth in six years

money.cnn.com

NEW YORK (CNNMoney.com) -- The U.S. economy grew at the fastest pace in more than six years during the fourth quarter of 2009, according to a government report Friday.

The nation's gross domestic product, the broadest measure of economic activity, rose at a 5.7% annual rate in the fourth quarter. That was much stronger than expected and provides another sign that a recovery in the economy is taking hold.

Economists surveyed by Briefing.com had forecast growth of 4.7%.

Good end to a terrible year. The growth in the fourth quarter was the highest since the third quarter of 2003. The e

(visit the link for the full news article)

That Obama... He is running this country into the ground! None of his polices worked. Wasn't the stimulus supposed to jump start the economy or something?

It's odd how people can trash talk a plan to their hearts content until the statistics are released. We always have to be wary of what we say about any economic actions because the statistics don't come out until later on. This is the reason that it is difficult for anyone to tell exactly what stage we are at economically at any given point in time. That's why being patient is mandatory; nobody is, was or ever will be qualified to fix the problems we are facing over night.



money.cnn.com
(visit the link for the full news article)

It won't matter to the Obama haters. They are more interested in hating the President than helping America. This is encouraging, though we are far from out of the woods. If this can be sustained, it will start producing jobs. It's really up to the banks to start lending. The banks are a greedy destructive bunch though, and are more interested in hoarding cash to protect their own profits than helping get the economy going again. this from the speculators that were more than happy to risk other peoples money a few years ago.
Wall street is the enemy.

Well, so far it has been a recovery that is starting with those that were hit the easiest. The biggest wrinkly in those numbers is that most of it comes from businesses restocking inventory in anticipation of sales. Give it another quarter and see how much of that inventory is still in the warehouse, then we can start talking recovery.

So wait, the market went down almost 10,000 pts and has had a year long bounce back of about half the loss and they are calling this rapid economic growth.

Whatever keeps them from jumping out of skyscrapers, I guess. But I don't see real progress when 1 out 5 are still making far less pay than they were 18 months ago and 1 in 10 are still unemployed.

It seems that people in this thread are unfamiliar with the saying: 'There are lies, damned lies and statistics.' Already various times I have explained how the US manipulates the US unemployment rate, so I'll refrain from doing that again. All I will say is that people who are taking these statistics for granted have no clue.

reply to post by Mdv2


There is no doudt that the unemployment statistics are based on a bogus foundation, but I'm not going to argue with them if they say the GDP is up. This ia great news. We should be worried more about inflation right now.

reply to post by Mdv2


Statistics are the only real form of evidence we can provide to come up with an idea of what is going on. I realize that you can use whatever numbers you would like and paint a variety of stories. In this case the stimulus and similar types of programs were intended to jump start the economy; it's looking like the initial part of the plan is working as intended.

With that being said, the jump start is like an initial shock to get the economy started and by the numbers we can see that shock is there. However, the real question is if that shock is enough to get the ball rolling again; the shock itself as the article explains means vary little. We will have to wait a while longer to find out the answer to that question. Things are going somewhat according to plan up to this point.

First off, your title is wrong. edit to change my assertion-the authors title was wrong-the author's title should have read the rate of change of the GDP, this is where they spread falsehoods.

From your linked article-

The nation's gross domestic product, the broadest measure of economic activity, rose at a 5.7% annual rate in the fourth quarter.

Do you know what rate of something is compared to what the something is?

The rate of growth is not a rise of 5.7%, it is the rate of change.

It is another play on words.

Let me put it this way. If you had a contraction of GDP growth at a rate of -25% in the third quarter and in the fourth quarter you had a rate of growth of -19.3%, you would then have a rate of growth compared to the third quarter of +5.7%.

This is just the same thing they do with unemployment. They do not say unemployment went up, they say the rate of increase in unemployment has gone down.

More propagandist news from the MSM.

[edit on 1/29/2010 by endisnighe]

reply to post by endisnighe


If you are trying to disprove what they are saying then you had better go get some actual number instead of using a hypothetical situation.

They described the situation in a accurate way. These numbers are still representing a positive light for our economy. If you would like to describe the situation in another manner then go get some actual numbers and write a report.

[edit on 29-1-2010 by Styki]

Originally posted by Styki


That Obama... He is running this country into the ground! None of his polices worked. Wasn't the stimulus supposed to jump start the economy or something?

(visit the link for the full news article)

The two aren't exactly mutually exclusive. As the article said, this was the highest rate of growth in six years, or since the latter portion of Bush's first term. We all know how well that turned out.

In this case, you can't throw an additional trillion dollars of new money into the system and not see some positive effect in the short term. Likewise, you can't create a trillion dollars out of thin air and not have significant inflationary pressure once the economy returns to full employment. My question is, how much inflation are we going to see as a result of Obama's fiscal policies once the employment picture starts to improve significantly? If I had to guess, the negative effects of inflation will far outweigh the short term gains to GDP over the next several years.

the economic growth has to do with the government pumping trillions of dollars into the economy. Lets see how it looks in 2011. Lets focus on whats best for our economy, maybe the Government actually did something right for the first time in a decade or however long it has been. We still have allot of men and women outta work, so this means nothing to them.. Kind of a statement placed out of context to the American, people yet maybe their is hope for those outta work.

reply to post by Styki



Right! And we know these figures are correct because....?
All my unemployed neighbors still don;t have jobs.
I think this is all whitewash.
The ONLY places making money either make bombs, oil or "Financial Products".
There were some people on the Titanic who still believed that it was unsinkable. I suggest we all at least find the lifeboats.
Sorry for the first line, I've never done that before. I guess I was waiting for the biggest pile of horsemanure to drop. Here it is.

From the article:

Slower growth ahead? Sung Won Sohn, economics professor at Cal State University Channel Islands, said there was good news in the report, but cautioned that the economy is unlikely to keep growing at such a strong pace.

"The not-so-good news is that most of the growth came from temporary factors such as inventories and government stimulus which can't be sustained," he said. Sohn's forecast is for GDP growth of 2.6% in the first quarter, and only a bit higher than that for the full year. Silvia expects GDP growth of 2.3% in the first quarter of 2010, and 2.7% for the full year.

But Achuthan said growth doesn't have to stay above 4% or 5% for the economy to start making significant gains.

They do mention that we are not going to be able to pump money into the economy at a sustained rate which was expected. The whole purpose of the plan was to jump start the economy.

There are downsides to the stimulus, adding to the debt by a huge amount was one of those. We can only hope that over time the positive effects will outweigh the negative.

reply to post by Asktheanimals


Nobody ever said the economy is all good and well now. The whole point of this article is that things are starting to possibly get better. We still have a long way to go.

On a side note, no offense to anybody but I only know of two people who lost their jobs during this economic downturn. One of them just got rehired by the same company within the past three weeks. The other one is not going to get rehired by the same place because they did restructuring (closed one plant and opened a new one). Basically, what's going on around us is not always and accurate description of the countries situation as a whole.

reply to post by Styki


I did not mean to say you had it wrong, I should have said the author of the article had it wrong. I will change my post to show that.

Just by memory, the last numbers I heard was that GDP was stated rising 2.7% and then it went down to 2.2% when it was revised when more accurate numbers came in.

That is why when I saw the number of 5.7, I knew it had to be rate of change, not change itself.

Sorry for the perceived disparagement against you.

reply to post by endisnighe


It's not a problem, you pointed out that sometimes (more often than not) when numbers are being presented they do have a lot of bias with them. Unfortunately, there is no other way to show the number unless you just give the numbers themselves. The numbers themselves are meaningless unless you know what to do with them, which means we have to make up some sort of story. For anybody who does not realize that, having someone point it out is vary important. I certainly wouldn't want anybody to read this and think we are in the clear.

My own tone might be a little too optimistic at times when it comes to the economy because I really don't like the idea of the US going broke.

reply to post by rogerstigers


Thanks for a reasonable explanation. The bad weather just before Christmas make have put a major ouch in the sale of that inventory.

As you said lets wait and see if this "recovery" actually is real. There are a lot of people out of work and more who are concerned their jobs will evaporate, this does not help the situation. More worrying is the doubling of the money supply in the first quarter of 2009 and the fact the Fed had to buy back 70% of that additional debt. Also Stewart Dougherty, a specialist in inferential analysis, states. "It is now "statistically impossible for the United States to pay its obligations". www.silverbearcafe.com... To add insult to injury Congress just hiked the debt ceiling again so it now matches the GNP.

This from the Market Oracle: As Orlov writes:

"Having given a lot of thought to both the differences and the similarities between the two superpowers - the one that has collapsed already [Soviet Union], and the one that is collapsing [USA] as I write this - I feel ready to attempt a bold conjecture, and define five stages of collapse....

Stage 1: Financial collapse. Faith in "business as usual" is lost. The future is no longer assumed to resemble the past in any way that allows risk to be assessed and financial assets to be guaranteed. Financial institutions become insolvent; savings are wiped out, and access to capital is lost.

Stage 2: Commercial collapse. Faith that "the market shall provide" is lost. Money is devalued and/or becomes scarce, commodities are hoarded, import and retail chains break down, and widespread shortages of survival necessities become the norm…

Stage 1 in Orlov's scenario is well underway. The vast majority of investment and commercial banks are now insolvent, propped up and still in business only because of recently granted government guarantees designed to prevent workers from realizing their life savings are in imminent danger."

In Orlov's Stage 1, savings and access to capital are lost. In modern economies, capital, i.e. credit-based paper, has been substituted for real money, gold and silver. Credit-based paper money is no more real money than an image/belief in god is GOD. Savings, in mature credit-based economies as the US and UK are now virtually non-existent.

Capital is but thinly disguised credit and credit is now rapidly disappearing, a condition that will be fatal for those addicted to its continuing presence, e.g. corporations, governments and workers, especially in the US , UK , Europe , etc. New loan activity has fallen 91 % year to year. The consequences will be unprecedented and extraordinary.

In 2009, the economic train wreck now in motion will occur. It will not be a one time event. It will be a successive series of protracted crisis in conjunction with continuing breakdowns in access to credit, goods and services, an escalating and cascading series of previously unimaginable events.
www.marketoracle.co.uk...

I hope and pray we are on our way to a recovery but I sincerely doubt it. We no longer have the industrial and manufacturing base to sustain a recovery. And Waxman is boumd and determined to kill our agriculture with his food bill and hike energy cost sky high, a sure recipe for complet disaster.

During the last census, taken in 2000, the USA had LESS manufacturing jobs than we did in 1970 despite our increased population. Statistics (courtesy of Bridgewater) showed in 1990, before WTO was ratified, Foreign ownership of U.S. assets amounted to 33% of U.S. GDP. By 2002 this had increased to over 70% of U.S. GDP. www.fame.org...

Both the republicans and the democrats, bought and paid for by the Central Bankers, have sold this country out. Now the chickens are coming home to roost and Obama is the one who will reap the disaster sown by the enemies of the USA who disguised themselves as Congressmen, Bankers and Educators.

Funny how unemployment is down still production is up. And up from what? Its still dismal compared to 3 years ago. O yeah Great news! lets all go spend some money and celibrate! NOT! Nothing in the markets make sense anymore because they are being manipulated, polls are manipulated, and so are government reports manipulated. So Hey wow! Big News! LMAO

The premise of this thread reminds me of Kevin Costner's saying from "The Postman"- "Stuff's getting better all the time".
The analogy is rather striking, since that was said with a backdrop of a world that had been all but destroyed, and Costner pretending that the government has been restored, and as stated "stuff's getting better all the time".
If this illusion of an improving economy makes you feel better, then I won't spoil your illusion.
However, as others have pointed out, the "improvement" is relative to a series of horrific economic statistics.
I won't get into debates with partisan ideologues. However, if you look at what ECONOMISTS had to say, the picture is a lot less promising:

NIGEL GAULT, CHIEF U.S. ECONOMIST, IHS GLOBAL INSIGHT,

LEXINGTON, MASSACHUSETTS:

"We got to be very cautious about what it implies for the future because it (came) from the inventory cycle... if you take out net exports as well, the actual final spending by U.S. consumers, businesses and government actually grew more slowing in the fourth quarter than the third quarter.

"I'm a bit doubtful that net exports can continue to be a plus because I think we're going to see a rebound in imports. Also, there's not a lot more, in terms of the growth effect, to come from inventories.

"I don't think it changes the story that it will still likely to be a relatively subdued recovery by historical standards."

CARL LANTZ, U.S. INTEREST RATE STRATEGIST, CREDIT SUISSE, NEW

YORK:

"A big inventory build added about 3.4 percent and then a swing in net exports added another half of a percent. When you look at domestic demand, final sales to domestic purchasers, it was only 1.7.

"It's ok. I think the underlying demand picture is kind of stabilizing but it's certainly not ramping up aggressively.

"The question is how much more inventory build is left to go and what's GDP going to look like once that inventory adjustment takes place? It still looks like the underlying growth rate of the economy is still pretty soft. That's kind of consistent with a sub-par recovery compared to what you normally would get coming out of a deep recession."

TOM PORCELLI, SENIOR ECONOMIST, RBC CAPITAL MARKETS, NEW YORK:

"When you strip out inventories, you see real final sales were 2.2 percent. This is not a fantastic number. If you compare this to the '75 and '82 recessions, real final sales in the first two quarters after, we averaged 5 percent after '82 recession, and about 4 percent after the '75. By comparison, we obviously are looking pretty weak.

"This is rear view mirror number and here were are in the first quarter, so from the macro perspective, there is not much that has changed to get all bulled up about."

www.reuters.com...