But then again …

Right after this positive post, I hit you with this:

But while there is a growing consensus that the so-called Great Recession ended some point earlier this year, some economists think that one quarter of solid economic growth does not indicate that a Great Recovery has begun.

Unemployment continues to rise and about 30% of factory capacity remains idle. Credit for businesses is still tight and consumer confidence is falling.

It’s also worth remembering that the economy grew as recently as the second quarter of 2008, when rebate checks sent to most taxpayers created a sugar rush of economic activity and a 1.5% rise in GDP.

Of course, that growth wasn’t enough to prevent the meltdown in financial markets last fall that touched off sharp declines over the next three quarters.

The economy wasn’t quite as bad as thought for Q2

More of that, “Well, the news still isn’t good, but it is better than we thought.” There’s a lot of looking for any ray of positive economic news still going on.

From the link:

The U.S. economy contracted at slower pace than previously thought in the second quarter as improved consumer and business spending cushioned the impact of a record decline in inventories, according to a government report on Wednesday.

The Commerce Department’s final estimate showed gross domestic product fell at a 0.7 percent annual rate instead of the 1.0 percent decline reported last month.

Analysts polled by Reuters had forecast GDP, which measures total goods and services output within U.S. borders, slipping at a 1.2 percent rate in the second quarter after dropping 6.4 percent in the January-March period.

This will probably mark the last quarter of decline in output for the U.S. economy, which slipped into recession in December 2007. The economy is believed to have rebounded in the July-September quarter.

With the second-quarter contraction, the country’s real GDP has shrunk for four straight quarters for the first time since government records started in 1947.

Second worst quarter in 50 years

Ouch.

From the link:

The great recession is shifting into a new phase, with the manufacturing sector taking the spotlight away from the consumer who got it all started.

Economic data to be released in the coming week could show that consumer spending has seen its worst, even as factories continue to slash output in the face of weakening demand from U.S. businesses and foreign buyers.

The weekly calendar also brings the third and final estimate for fourth quarter gross domestic product, with another downward revision likely to show the second worst quarter in the past half century, with GDP plunging at a 6.7% annualized rate. The final GDP revision will come Thursday at 8:30 a.m. Eastern.

The first quarter could be almost as bad, but economists say the economy is making progress in adjusting to a world with slower income growth and smaller sales.

GDP drops hard

Drops hard as in biggest economic shrinkage in 27 years. This dates back to Reagan’s first term.

From the link:

The Commerce Department on Friday said gross domestic product, which measures total goods and services output within U.S. borders, plummeted at a 3.8 percent annual rate, the lowest pace since the first quarter of 1982, when output contracted 6.4 percent. GDP fell 0.5 percent in the third quarter. These were the first consecutive declines in GDP since the fourth quarter of 1990 and the first three months of 1991.

Analysts polled by Reuters had forecast GDP contracting 5.4 percent in the fourth quarter. The U.S. economy slipped into recession in December 2007, driven by the collapse of the housing market and resulting global credit crisis.

US economy had a bad, bad fourth quarter

Not surprising, but ouch.

From the link:

The U.S. economy contracted violently in the fourth quarter, with gross domestic product falling at its fastest pace in more than 25 years, economists said ahead of what promises to be a grim week of economic news.

“Real economic activity fell off a cliff during the fourth quarter, producing a sharp drop in employment, output and spending,” wrote economists at Wachovia.

And the worst part is that it’s not over. Economists expect another huge decline in the first quarter, with a smaller contraction in the second quarter.

GDP is expected to have fallen at a 5.5% annualized rate in the final three months of last year, according to the median forecast of economists surveyed by MarketWatch. That would be the biggest decline since the 6.4% drop in early 1982 and one of the worst quarters in the post-World War II era.