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GDP Contracts For 4th Straight Quarter

From the ever hopeful Associated Press:

GDP report is likely to show recession eased in 2Q

By Jeannine Aversa, AP Economics Writer

WASHINGTON – The economy sank at a pace of just 1 percent in the second quarter of the year, a new government report shows. It was a better-than-expected showing that provided the strongest signal yet that the longest recession since World War II is finally winding down

The economy has now contracted for a record four straight quarters for the first time on records dating to 1947. That underscores the grim toll of the recession on consumers and companies.

Many economists were predicting a slightly bigger 1.5 percent annualized contraction in second-quarter GDP…

Less drastic spending cuts by businesses, a resumption of spending by federal and local governments and an improved trade picture were key forces behind the better performance…

The Commerce Department also reported Friday that the recession inflicted even more damage on the economy last year than the government had previously thought. In revisions that date back to the Great Depression, it now estimates that the economy grew just 0.4 percent in 2008. That’s much weaker than the 1.1 percent growth the government had earlier calculated.

Also Friday, the government reported that employment compensation for U.S. workers has grown over the past 12 months by the lowest amount on record, reflecting the severe recession that has gripped the country

Federal Reserve Chairman Ben Bernanke has said he thinks the recession will end later this year. And many analysts think the economy will start to grow again — perhaps at around a 1.5 percent pace — in the July-to-September quarter. That would be anemic growth by historical measures, but it would signal that the downturn has ended

The convergence of a collapse in the housing market, a near shutdown of credit and a financial crisis created what Bernanke and others have called a perfect storm for the economy. Those negative forces — the scale of which hasn’t been seen since the 1930s — plunged the country into a recession in December 2007. It is the longest since World War II

Of course the real news in this article is the staggering fact that the economy has contracted for four quarters in a row for the first time since the gearing down after WWII:

The economy has now contracted for a record four straight quarters for the first time on records dating to 1947.

And this:

Also Friday, the government reported that employment compensation for U.S. workers has grown over the past 12 months by the lowest amount on record…

In plain English this means that the pay for US workers grew at the slowest rate in the recorded economic history of the nation over the last year.

But instead of trumpeting these mundane details, the Associated Press chose instead to highlight the dubious claim that the recession is lessening.

And many analysts think the economy will start to grow again — perhaps at around a 1.5 percent pace — in the July-to-September quarter. That would be anemic growth by historical measures, but it would signal that the downturn has ended…

Meanwhile, as we have noted, Granma has reported that Cuba’s economy is growing at 1.5 percent. And the Castros are so panicked they are closing down factories and turning off the power.

But the AP can’t even be as honest as Cuba’s state-run news service is about Cuba’s sad state of affairs.

Those negative forces — the scale of which hasn’t been seen since the 1930s — plunged the country into a recession in December 2007. It is the longest since World War II.

Instead, the AP once again repeats this untruth that the country went into recession back in December 2007.

As we have oft noted, the accepted definition of a recession is two consecutive quarters of ‘negative growth.’ Something that did not occur until the Presidency of Barack Obama.

But the AP has to continue the lie that we started this recession during the administration of President Bush.

After all, that is their job.

This article was posted by Steve on Friday, July 31st, 2009. Comments are currently closed.

3 Responses to “GDP Contracts For 4th Straight Quarter”

  1. Gila Monster says:

    The AP’s Jeannine Aversa just can’t help herself. As it stands, she may as well be the Messiah’s economic advisor / publicist in the WH with this constant shoveling of unadulterated propaganda.
    What a flippin’ tool!!

  2. Liberals Demise says:

    Kenya’s Hero must be ecstatic because he is doing better than planned!

  3. artboyusa says:

    I misread the headline and thought it read “GOP contracts for 4th straight quarter”. No surprise there, I said to myself.


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