GDP grows at 2.4 percent in Q2

[I AM NOT THAT GUY 5,715]

Another day, another ugly economic report. Today, we learned that annualized GDP growth over the past quarter was 2.4 percent. Not nothing, but quite a bit lower than the 3.7 percent we saw in the first quarter. More worrying, consumer spending grew at 1.7 percent. Without that, we've not got a lot to grow with. And the stimulus, which supported a lot of the recent growth, is about to drain out of the economy.

And as Neil Irwin notes, the story is actually even worse than that: We also learned that we'd been overestimating recent growth numbers. We'd thought the GDP grew by 0.4 percent in 2008. Now the Commerce Department says it flatlined. All this is worrying on two levels: First, bad economic news is bad economic news. And second, if you're a business deciding whether the economy is strong enough for you to begin taking risks again, there's not a lot here that'll push you off the ledge.

http://voices.washingtonpost.com/ezra-klein/2010/07/gdp_grows_at_24_percent_in_q2.html

Edited July 30, 2010 by ##########

[mendeleev 68]

While its true that Q2 growth was only 2.4% and 2008 numbers were revised downward, OP fails to mention that Q1 growth numbers were also revised up to 3.7% and end '09 was close to 5%. It is normal for GDP numbers to be revised, sometimes repeatly, as time proceeds and better data become available.

As the stimulus fades, it does indeed appear we face a square root recovery. Anemic recoveries are unfortunately typical results of severe financial crises. Bolder action in early 2009 would have been much more helpful than what we got.

Agreed, though, this report is disappointing. And it does encourage business to remain on strike.

Edited July 30, 2010 by novotul