Economic growth for the third quarter, which was estimated at 3.9% a month ago, was revised upward to 4.9% by the government's Bureau of Economic Analysis (BEA). The BEA announcement is here.
This of course explains why a Google News search I just did on "recession" has hundreds and hundreds of articles talking about a possible recession, including 481 in the first 20 listings (/sarc).
Key excerpts from the BEA report (bolds are mine):
The increase in real GDP in the third quarter primarily reflected positive contributions from exports, personal consumption expenditures (PCE), private inventory investment, equipment and software, federal government spending, nonresidential structures, and state and local government spending that were partly offset by a negative contribution from residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.
..... The real change in private inventories added 0.98 percentage point to the third-quarter change in real GDP, after adding 0.22 percentage point to the second-quarter change. Private businesses increased inventories $32.9 billion in the third quarter, following an increase of $5.8 billion in the second quarter and an increase of $0.1 billion in the first.
Ever since the fourth quarter of 2006, when there was a big downward revision to GDP because of inventory reductions, I have been wondering when the reverse was going to occur, because it almost had to. Now it has.
Two tidbits you may not see reported elsewhere (source info from BEA is here):
- If it holds, and I believe it will, this is the best quarter since 3Q03, and the second best since 2Q-2000.
- Again if it holds, the combined 2nd and 3rd quarter total of 8.7% (after the 2nd quarter's 3.8%; quarterly percentages are presented in annualized form) is the highest since the 3Q03 and 4Q03's 10.2%. 2Q03 and 3Q03 were a combined 11.0%.
I don't expect this revision to break out of the business pages. The expectations that built up in the past week were barely news. 5.0% would have been tougher to ignore. We'll see.
Cross-posted at BizzyBlog.com.
—Tom Blumer is president of a training and development company in Mason, Ohio, and is a contributing editor to NewsBusters
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Comments Policy
The Liberal Media YEARNS for a Recession ...
November 29, 2007 - 11:20 ET by jonathananderson... for ANY bad news that they can pin on George Bush and Republicans.
The MSM = Pravda-lite ... no, Pravda on steroids.
Why do any of you folks
November 29, 2007 - 11:34 ET by ncstevemWhy do any of you folks even watch the TV news or read the newspapaers?
I like the tag line I read on here that read something to the effect that when you cancel your newspaper subscription, you put another journalist out of work. Couldn't happen to a nicer crowd.
"Keep your friends close,
November 29, 2007 - 11:44 ET by Jimbo"Keep your friends close, but your enemies closer".
Leon says "By the way, I'm not afraid of fat people, I'm repulsed"
Truth Monger Says - "Both are religions [Christianity & Islam], yes - with the same percentage of terrorists."
The Fed Must be Cooking the Books
November 29, 2007 - 11:43 ET by TinianWe all know this impossible when your economy is based on Fiat money
Rally online with fans of Dr. Ron Paul.
But ...
November 29, 2007 - 12:26 ET by Dave in TexasBut Tom. There are isolated, non-typical examples of individuals who are going through tough financial times that CNN/ABC/NBC/CBS can do stories on with sad music playing in the background. Doesn't that prove that we're in a recession? ;)
Tom, you stated, "I don't
November 29, 2007 - 15:39 ET by jdhawkTom, you stated, "I don't expect this revision to break out of the business pages." Wrong.
I subscribe to the WSJ on line edition. Even in America's premiere business paper, the story is no where to be found on the front page. You have to go to the Economy section of the paper and then, it is buried in a pessimistic article about the housing situation.
The WSJ on line edition's front page lead with an article about prices of new home sales falling. Of course, they could have lead with new home sales increase, but that would have been too optimistic.
It is a sad state when even our largest circulation business paper is anything but pro business and America (with the exception of their superb editorial section).
I am glad Murdoch bought the paper. I am anxious for him to bring in some pro business conservative reporters.
Wow
November 29, 2007 - 16:31 ET by Tom BlumerD**n.
lagging vs leading indicators
November 29, 2007 - 15:42 ET by johnGthis past gdp doesn't indicate of where the economy is going. just because LAST quarter was on par predicts nothing for the upcoming quarter(s). when you look for what the economy is going to do the previous quarter's GDP isn't usually what you look at.
John, do you mind telling
November 29, 2007 - 15:47 ET by MightyMouthJohn, do you mind telling us poor dumb bastards what you DO look at? (btw I mean that, when it comes to the economy I am a PDB)
"There are two types of people in this country; those who provide freedom and those who enjoy it." MM says...
a few hints
December 4, 2007 - 12:33 ET by johnGsorry it took me awhile to get back to you, but here are just a small list of indicators that you could watch:
labor market indicators, consumer spending, global
economic conditions, corporate profits, consumer credit availability,
monetary police, housing conditions, consumer confidence, inflation, capital spending.
What to look at
November 29, 2007 - 16:29 ET by Tom BlumerMore recent stuff:
- ISM Manufacturing for October -- still in expansion mode, if barely (about 15% of economy)
- ISM Non-Manufacturing for October -- expanding by a greater amount than in September (about 85% of the economy)
- Retail sales -- up in October more than "expected"
- Christmas-season retail sales -- Black Friday up about 8% instead of "expected" 4% over 2006.
- Cyber Monday -- up 21% over 2006.
If that isn't recent enough for you, and you're still looking for the Holy Grail of gloom, you can hold out hope that the November ISM reports to be released this coming Monday and Wednesday head in the wrong direction, or that Friday, Dec. 7's employment situation report is a downer. On the whole, I think they'll not be as good as their October counterparts, but still wayyyy on the side of being non-recessionary.