GDP grows 8.2% the best showing in nearly 20 years

http://www.suntimes.com/output/business/23economy.html
Gross Domestic Product grows 8.2% in 3rd-quarter
December 23, 2003
BY MARTIN CRUTSINGER ASSOCIATED PRESS

WASHINGTON -- The U.S. economy, propelled by tax cuts and low interest
rates, roared ahead at an 8.2 percent annual rate in the third quarter, the
best showing in nearly 20 years, while Americans' incomes and spending both
showed healthy gains in November.
The government reports Tuesday on the gross domestic product, the country's
broadest measure of economic health, and personal incomes and spending
provided further evidence that the economy was convincingly shaking off a
prolonged period of lethargy and beginning to fire on all cylinders.
The Commerce Department report that the GDP grew at an 8.2 percent rate in
the third quarter, propelled by a surge in consumer spending, was identical
to the preliminary estimate made a month ago and represented the strongest
growth since an 8.4 percent rate of increase in the fourth quarter of 1983.
In a separate report, the government said consumers were remaining active in
the current quarter with consumer spending rising by 0.4 percent in
November, the best showing since August, and incomes, helped by rising
employment levels, posted an increase of 0.5 percent last month, the best
gain since May.
Many analysts believe that GDP growth in the current quarter could well top
5 percent, representing the best back-to-back growth rates since the boom
years of the 1990s.
The economy began the year growing at much slower rates of 2 percent in the
first quarter and 3.1 percent in the second quarter before the jolt from a
new round of tax cuts propelled consumer spending in the third quarter.
Growth has also been helped this year by the Federal Reserve's decision to
keep a key interest rate at the lowest level in 45 years, providing strength
to such interest rate-sensitive sectors as housing and auto sales.
All of the GDP figures released Tuesday reflected a comprehensive revision
that the government does every five years to make sure the measurement of
total output keeps up with the times. With the changes, the GDP grew by 2.2
percent for all of 2002, down slightly from the previous estimate of 2.4
percent.
The benchmark revisions and the changes to third quarter GDP showed a number
of crosscutting revisions that basically offset each other to make little
impact on the bottom-line number.
For the third quarter, consumer spending was revised up to an even-stronger
6.9 percent rate of growth, the best showing since the third quarter of
1986, compared to last month's estimate of 6.4 percent.
But private investment, which covers housing construction and business
spending on plants and equipment, was revised down to a 14.8 percent rate of
increase, reflecting slightly less business investment which offset a bigger
increase in housing construction.
Even with the strong growth, inflation remained under control with a price
gauge tied to the GDP rising at an annual rate of just 1.8 percent in the
third quarter.
The monthly incomes and spending report showed that 0.4 percent November
jump in consumer spending, which accounts for two-thirds of total economic
activity, followed a tiny 0.1 percent rise in October and no change at all
in September. However spending had soared by 0.9 percent in August,
reflecting the burst of activity spurred by the tax cuts which went into
effect in July.
The 0.5 percent rise in personal incomes followed much smaller increases of
0.2 percent in October and 0.3 percent in September. The strength last month
came from a big wages and salaries, which rose by $16 billion in November
compared to an October gain of $8.2 billion.
After an extended period of layoffs, employers have begun adding workers to
their payrolls, which should help bolster incomes even more in coming
months.

--
Atheism teaches that there is no God, hence no God-given rights. That
ideology coupled with a system that believed in the superiority of the state
at the expense of the individual was murderously synergistic.

dpr wrote:

> http://www.suntimes.com/output/business/23economy.html
> Gross Domestic Product grows 8.2% in 3rd-quarter
> December 23, 2003
> BY MARTIN CRUTSINGER ASSOCIATED PRESS
>
> WASHINGTON -- The U.S. economy, propelled by tax cuts and low interest
> rates, roared ahead at an 8.2 percent annual rate in the third quarter, the
> best showing in nearly 20 years, while Americans' incomes and spending both
> showed healthy gains in November.
> The government reports Tuesday on the gross domestic product, the country's
> broadest measure of economic health, and personal incomes and spending
> provided further evidence that the economy was convincingly shaking off a
> prolonged period of lethargy and beginning to fire on all cylinders.
> The Commerce Department report that the GDP grew at an 8.2 percent rate in
> the third quarter, propelled by a surge in consumer spending, was identical
> to the preliminary estimate made a month ago and represented the strongest
> growth since an 8.4 percent rate of increase in the fourth quarter of 1983.
> In a separate report, the government said consumers were remaining active in
> the current quarter with consumer spending rising by 0.4 percent in
> November, the best showing since August, and incomes, helped by rising
> employment levels, posted an increase of 0.5 percent last month, the best
> gain since May.
> Many analysts believe that GDP growth in the current quarter could well top
> 5 percent, representing the best back-to-back growth rates since the boom
> years of the 1990s.
> The economy began the year growing at much slower rates of 2 percent in the
> first quarter and 3.1 percent in the second quarter before the jolt from a
> new round of tax cuts propelled consumer spending in the third quarter.
> Growth has also been helped this year by the Federal Reserve's decision to
> keep a key interest rate at the lowest level in 45 years, providing strength
> to such interest rate-sensitive sectors as housing and auto sales.
> All of the GDP figures released Tuesday reflected a comprehensive revision
> that the government does every five years to make sure the measurement of
> total output keeps up with the times. With the changes, the GDP grew by 2.2
> percent for all of 2002, down slightly from the previous estimate of 2.4
> percent.
> The benchmark revisions and the changes to third quarter GDP showed a number
> of crosscutting revisions that basically offset each other to make little
> impact on the bottom-line number.
> For the third quarter, consumer spending was revised up to an even-stronger
> 6.9 percent rate of growth, the best showing since the third quarter of
> 1986, compared to last month's estimate of 6.4 percent.
> But private investment, which covers housing construction and business
> spending on plants and equipment, was revised down to a 14.8 percent rate of
> increase, reflecting slightly less business investment which offset a bigger
> increase in housing construction.
> Even with the strong growth, inflation remained under control with a price
> gauge tied to the GDP rising at an annual rate of just 1.8 percent in the
> third quarter.
> The monthly incomes and spending report showed that 0.4 percent November
> jump in consumer spending, which accounts for two-thirds of total economic
> activity, followed a tiny 0.1 percent rise in October and no change at all
> in September. However spending had soared by 0.9 percent in August,
> reflecting the burst of activity spurred by the tax cuts which went into
> effect in July.
> The 0.5 percent rise in personal incomes followed much smaller increases of
> 0.2 percent in October and 0.3 percent in September. The strength last month
> came from a big wages and salaries, which rose by $16 billion in November
> compared to an October gain of $8.2 billion.
> After an extended period of layoffs, employers have begun adding workers to
> their payrolls, which should help bolster incomes even more in coming
> months.
>


Big deal. Miserable GDP meets Xmas season. Of course there's growth.

betcha most of the new hires lose their jobs once the season ends.