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First Quarter Growth Has ‘Cooled’ To 2.2%

From an unfazed and unashamed Reuters:

First-quarter growth slows on inventories, weak business spending

By Lucia Mutikani
April 27, 2012

WASHINGTON (Reuters) – Economic growth cooled in the first quarter as businesses cut back on investment and restocked shelves at a slower pace, but stronger demand for automobiles softened the blow.

Gross domestic product expanded at a 2.2 percent annual rate, the Commerce Department said on Friday in its advance estimate, moderating from the fourth quarter’s 3 percent rate.

You see, US economic growth isn’t going down, it is merely ‘slowing’ and ‘cooling’ and ‘moderating.’ After all, nobody would want it to remain at the red hot breakneck pace of 3%.

While that was below economists’ expectations for a 2.5 percent pace, a surge in consumer spending took some of the sting from the report and growth was still stronger than analysts’ predictions early in the quarter for an expansion below 1.5 percent.

Remember how consumer spending was evil during the Bush administration? Besides, how much of this wonderful increase in consumer spending is due to the increase in the price of gasoline and food?

"There’s nothing catastrophic happening, this is just slow growth and this underscores that the economy is on sound footing but nothing more," said Steven Baffico, chief executive at Four Wood Capital Partners in New York

Lest we forget, 3.3% growth was reported to be proof we were in a recession during the Bush administration. Now 2.2% growth is proof that the economy is on a "sound footing."

Here is the Associated Press’ subtle effort at spinning flax into gold:

US growth slowed to 2.2 percent in first quarter

April 27, 2012

WASHINGTON (AP) — The U.S. economy grew more slowly in the first three months of this year. Governments spent less, and businesses cut back on investment. But consumers spent at the fastest pace in more than a year.

The result suggests that the economy will continue to expand, slowly but steadily.

Happy days are here again!

The Commerce Department estimated Friday that the economy grew at an annual rate of 2.2 percent in the January-March quarter, compared with a 3 percent gain in the final quarter of 2011. But growth is expected to rebound to around 3 percent for all of 2012 as stronger job growth spurs more consumer spending

Prosperity is just around the corner.

The 2.2 percent overall increase in the economy in the first quarter marked the 11th consecutive quarter that the gross domestic product has expanded since the deep 2007-2009 recession ended in June 2009. But the gains have been far below the usual increases coming out of a deep recession…

An admission that is artfully buried deep in the AP’s article.

In point of fact, as we have previously noted, the Wall Street Journal found that this is the weakest recovery in the history of the Republic:

The Worst Economic Recovery in History

April 2, 2012

During the postwar period up to the current recession (1947-2007), the average annual growth rate for the U.S. was 3.4%

So our current 2.2% GDP is 1.2% lower than average. Meanwhile, GDP is supposed to soar after a recession.

According to the National Bureau of Economic Research, the recovery began in the second half of 2009. Since that time, the economy has grown at 2.4%, below our long-term trend by either measure. At this point, the economy is 12% smaller than it would have been had we stayed on trend growth since 2007.

Worse, the gap is growing over time. Today, the economy is four percentage points further from the trend line than it was the first quarter of 2009 when this administration’s nearly $900 billion fiscal stimulus efforts began. If forecasts of around 2% growth turn out to be accurate, we will add to that gap this year

In the early 1980s, the economy experienced a double-dip recession, with contractions in both 1980 and ’82. But growth rates in the subsequent two years averaged almost 6%

But Mr. Obama is not doing what Mr. Reagan did in the 1980s. In fact, he is doing the exact opposite.

Which is why our GDP is 2% instead of 6%.

This article was posted by Steve on Friday, April 27th, 2012. Comments are currently closed.

4 Responses to “First Quarter Growth Has ‘Cooled’ To 2.2%”

  1. untrainable says:

    …the economy is on sound footing but nothing more…
    Yeah, and there is sound footing right up to the edge of the Grand Canyon too. Then just next to that sound footing is a really deep hole. With Oblameless in charge, our economy is running towards that abyss at breakneck speed.

  2. GetBackJack says:

    I think it remarkable that even with federal jackboots on the necks of American business, Americans still managed to hold their own and grow the economy 2.2%.

    Pretty amazing considering the Administration’s hatred for everything that works and is good.

  3. Right of the People says:

    Typical Dimocrap speak:

    Republicans, 3.3% growth in GDP = slow
    Dimocraps, 3% growth GDP = splendid

    Republicans, 5% unemployment = unacceptable
    Dimocraps, 9% unemployment = an improving economy

    It’s all a matter of perspective. When you’ve got Hope and Change and Unicorn farts on your side everything is better.

  4. AcornsRNutz says:

    Consumer spending being up may have a lot to do with increased prices, but I suspect there is another factor being blatantly ignored by the media. Tax refunds. All those folks (myself included) who knew they were getting money back filed way back in February. That money got spent (on food and gas mostly). Considering that ttaz refund money is all money taken out of the economy in an interest free loan to the federal government for mots of the previous year, I doubt that it can really count toward making anything grow. Bottom line, economy is stagnant and getting worse. I am not sure how many ways they can try to spin it before it becomes completely obvious to even the most die-hard liberal stooge.

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