GDP revision points to a faltering recovery

Posted on 27 August 2010

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Economic statistics released today offered the clearest sign yet that the recovery is slowing.

The government lowered its estimate of economic growth in the second quarter to an annual rate of 1.6 percent after originally reporting last month that growth in the three-month period was 2.4 percent, the New York Times reports.

The revision of the nation's gross domestic product marks a significant slowdown from the annual rate of 3.7 percent in the first quarter and 5 percent in the last three months of 2009.

The news came at the end of a week that showed the economic retrenchment that began in the second quarter has spilled over into the summer. Home resales in July were down to their lowest level in a decade and sales of new homes that month were at their lowest level since the government began tracking such data in 1963.

Orders for large factory goods, excluding the volatile transportation sector, dropped in July, indicating that recovery in the manufacturing sector also is stalling.

Economists are now concerned that the outlook for job creation, which has been sputtering all summer, could deteriorate further.

"When you get a downshift in growth, there is a risk that it will feed on itself," James F. O'Sullivan, the chief economist at MF Global, told the newspaper. "The question now is to what extent has the improving trend just been temporarily set back or has it really been short-circuited."

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Comments

5 Friday, 27 August 2010 21:34

AMEN!!!

4 Friday, 27 August 2010 18:57

My business is 118% over 2009???? what that means is that 2009 sucked BAD and 2010 ,by the grace of GOD is holding on;; the american spirit and the voting booth will change all this runaway spending, and an arrogant administration in washington. Lets all pray that GOD tells everyone to vote... theres no one has confidence in washington... Wild Bill

3 Friday, 27 August 2010 16:12

its not temporary..but holding onto cash that will be needed to comply with new burdensome business costs that will not be able to be passed to the consumer and a lack of hiring attributed to those very same costs of  employment

2 Friday, 27 August 2010 15:48

Hi,

I'm sorry --- is anybody out there that really believes we are in a recovery?

I find it hard to believe that anybody that looks at the overall economy would think we are anywhere near going forward.

The congress is out of control and needs a major overhaul.

Read that to mean, put out of their jobs and their retirement and health care taken away from them like many of our factory workers who have lost their jobs and health care after they retired.

At what point in time did our congress people become better than the people they were supposed to be serving?

This country beats the hell out of second place but needs a new COMPLETE leadership.

Jim Davies

Rock Island, IL.

1 Friday, 27 August 2010 15:30

MID-TERMS can't get here soon enough.  Somebody has to slow down this administration.  We are 60 days or so away from doing that.  That will restore some confidence.  But we still have serious problems.   

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