Hooray! The Gross Domestic Product shrank by 2.9% in the first quarter of the year. "This recovery is underway."
Your humble correspondent was very careful to put the previous sentence in quotes because I don't want you to think I've taken leave of my senses. This amazing conclusion comes to us courtesy of CNN Money spinmeister Annalyn Kurtz who starts out on a rather gloomy note but manages to spin her way into economic joy:
Well, this picture keeps getting uglier.
The U.S. economy shrank in the first quarter of the year, and new revisions by the Bureau of Economic Analysis show the decline was even deeper than reported. Gross domestic product -- the broadest measure of economic growth -- contracted at a 2.9% annual rate in January through March. That's the weakest quarter for the U.S. economy since the first quarter of 2009, amid the Great Recession.
Uh-oh! This doesn't sound good but have no fear. Ladies and gentlemen! Step aboard Kurtz's amazing flying spin machine!
But economists aren't too worried, for three key reasons.
Eh! No big deal...according to selected unnamed economists.
1) They blame the weather: Much of the downturn was due to a brutal winter. Blizzards slowed shipments both domestically and abroad and kept consumers away from shopping malls, car lots and open houses more than usual this winter. The GDP data shows consumer spending was weak in the first quarter. Meanwhile, exports to foreign countries declined and spending on residential real estate slumped.
Ah! That old reliable standby excuse. Winter. And what a shock to learn there were blizzards during the winter. Okay, now to the next spin:
2) It's not a final number: Some economists take this GDP number with a grain of salt because it will be revised again next month when the Bureau of Economic Analysis makes historical revisions. The weak number also doesn't fit with the story told by other key economic indicators, like job growth.
Wasn't it already revised from a .1% growth to a 1% decline to now a 2.9% drop? Somehow that final number seems to be continually going in a down direction. And now on to the final spin performance:
3) Last, but certainly not least, other data show the economy is improving. Hiring slowed in December, but it has since picked up again. In the last five months, the economy added 1.1 million jobs. Hiring at that level is consistent with an economy that is growing modestly around 2% to 3% a year -- not an economy that is contracting.
Unless something "unexpectedly" happens. And guess what? One of those annoying "unexpectedlys" happened this very morning as reported by Reuters, U.S. durable goods unexpectedly fall in May:
(Reuters) - Orders for long-lasting U.S. manufactured goods unexpectedly fell in May, suggesting an anticipated rebound in growth this quarter could fall short of expectations, even as a measure of business capital spending plans rose.
The Commerce Department said on Wednesday durable goods orders declined 1.0 percent as demand for transportation, machinery, computers and electronic products, electrical equipment, appliances and components, and defense capital goods fell.
Yet despite those nasty "unexpectedlys" unexpectedly rearing its ugly head, Kurtz issues this conclusion from the Ministry of Joy:
Overall, the same old story remains: This recovery is underway, but it's still very slow.
Just hand me some more Soma spin and I might even be able to forget that "slow" caveat.