US GDP growth in Q4 2007 was only 0.6%

[w¡n9Nµ7 §£@¥€r 123]

The economy nearly stalled in the fourth quarter with a growth rate of just 0.6 percent, capping its worst year since 2002.

The Commerce Department's report on the gross domestic product, released Wednesday, showed an economy that had deteriorated considerably during the October-to-December quarter ...

...

The 0.6 percent annualized increase in gross domestic product (GDP) marked a big loss of momentum from the third quarter's brisk, 4.9 percent showing.

...

Meanwhile, inflation picked up sharply during the final quarter.

...

A gauge of inflation linked to the GDP report showed that "core" prices -- excluding food and energy -- grew at a rate of 2.7 percent in the fourth quarter. That was up from a 2 percent rate in the prior quarter and was the biggest quarterly increase since the spring of 2006.

http://biz.yahoo.com/ap/080130/economy.html?.v=4

[Peikko 1,575]

Is the economy really like the universe, capable of infinit exponential growth? It seems rather an absurd notion to my novice economic eyes.

[w¡n9Nµ7 §£@¥€r 123]

Is the economy really like the universe, capable of infinit exponential growth? It seems rather an absurd notion to my novice economic eyes.

I read an interesting article recently on just that. I'll post it here if I can find it.

[Peikko 1,575]

Thanks Mr Troll

[simple_male 1]

The economy nearly stalled in the fourth quarter with a growth rate of just 0.6 percent, capping its worst year since 2002.

The Commerce Department's report on the gross domestic product, released Wednesday, showed an economy that had deteriorated considerably during the October-to-December quarter ...

...

The 0.6 percent annualized increase in gross domestic product (GDP) marked a big loss of momentum from the third quarter's brisk, 4.9 percent showing.

...

Meanwhile, inflation picked up sharply during the final quarter.

...

A gauge of inflation linked to the GDP report showed that "core" prices -- excluding food and energy -- grew at a rate of 2.7 percent in the fourth quarter. That was up from a 2 percent rate in the prior quarter and was the biggest quarterly increase since the spring of 2006.

http://biz.yahoo.com/ap/080130/economy.html?.v=4

I am not surprised.

[w¡n9Nµ7 §£@¥€r 123]

Ok I can't find it. The gist was that as economies mature, average growth rates come down. This is also what my econ profs told me in college. However, the article goes takes the narrative further. What happens when the so-called 'developed' economies continue to further develop, is a point ever reached where average growth rates drop to 0? Is there ever a 'steady state'? The article I read basically said yes but no economy on earth is at that stage yet. That stage is reached when you have a stable population and optimal productivity.

Sorry, no URL. I'll post if I run into it again tho.

[Peikko 1,575]

Thanks, I would be really interested in reading that.

Do economic theories ever take into account that humans don't behave in a rational fashion?

[w¡n9Nµ7 §£@¥€r 123]

Do economic theories ever take into account that humans don't behave in a rational fashion?

There's a ton of literature addressing that as well.

[GaryC 7]

Question, isn't a recession where the economy "recedes"? This says we are still growing albeit at a slower rate. I though we were in a recession for quite a while now.

[Heracles 417]

Thanks, I would be really interested in reading that.

Do economic theories ever take into account that humans don't behave in a rational fashion?

yes. They are called idiots.

EG http://www.visajourney.com/forums/index.php?showtopic=107768

Edited January 30, 2008 by Boo-Yah!

[w¡n9Nµ7 §£@¥€r 123]

Question, isn't a recession where the economy "recedes"? This says we are still growing albeit at a slower rate. I though we were in a recession for quite a while now.

Classical definition of a recession is two quarters of negative growth.

Q4 2007 came in at 0.6. Unless it is later revised to a value below 0 (it can happen, revisions are common), we were not in a recession in Q4. Just a slowdown.