Economy grew 3.3% in Q2

posted at 10:10 am on August 28, 2008 by Ed Morrissey

Phill Gramm may have worded his assertion in an impolitic manner, but the latest economic data proves him correct.  The US economy grew at an annual rate of 3.3% in the second quarter, almost twice as much as first predicted.   Exports led the way, followed by an increase in personal spending:

Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 3.3 percent in the second quarter of 2008, (that is, from the first quarter to the second quarter), according to preliminary estimates released by the Bureau of Economic Analysis.  In the first quarter, real GDP increased 0.9 percent.

The GDP estimates released today are based on more complete source data than were available for the advance estimates issued last month.  In the advance estimates, the increase in real GDP was 1.9 percent (see “Revisions” on page 3). …

The acceleration in real GDP growth in the second quarter primarily reflected a larger decrease in imports, an acceleration in exports, an acceleration in PCE, a smaller decrease in residential fixed investment, and an upturn in state and local government spending that were partly offset by a larger decrease in inventory investment.

Does this cut out the legs from the Democrats in their non-stop themes of complaint regarding the economy?  It should, but it probably won’t.  A growth rate of 3.3% is a good, solid number, one that shows real substance in the economy.  It remains weak in some areas as does the dollar, but fundamentally strong.

The Democrats have tried to make the current economy as bad as the Depression, but in fact it hasn’t even gotten near the Clinton recession that began in his last year in office.  They have been hammering themes of economic mismanagement, but the real weaknesses in the economy have bipartisan fingerprints all over them.  Chris Dodd’s sweetheart deals with lenders while chairing the Banking Committee certainly looks very suspicious, as did Barack Obama’s own selection of VP vetter Jim Johnson, a major player in the credit-market failure while raking in millions in unreported income at Fannie Mae.

In the end, the scare mongering may still have some resonance, as job growth is a lagging and not leading indicator of recovery.  That tactic worked well for Bill Clinton in 1992 when George H. W. Bush couldn’t explain clearly enough that the recovery from the 1991 recession had already begun.  In this case, John McCain and the GOP need to point out that Obama intends to attack the incentives for investment needed to continue the growth and create new jobs.  They’ll have plenty of time to do that next week, while Democrats continue to insist that the sky is falling when clearly no disaster has occured.

Update: Earlier, I mentioned that the numbers exceeded inflation, but real GDP already accounts for inflation.  The 3.3% annual growth is above inflation already.


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Biden referred to our current “recession” on the day BO revealed him as his VP nominee. There has not been a recession for years.

jgapinoy on August 28, 2008 at 10:12 AM

But…but…but…but…

grapeknutz on August 28, 2008 at 10:14 AM

Still no recession however badly the Democrats and MSM have been wishing for one.

carbon_footprint on August 28, 2008 at 10:15 AM

Implying we are in a Depression is as silly as calling Bush Hitler. Dems love hyperbole.

Disturb the Universe on August 28, 2008 at 10:15 AM

You know who this doesn’t help? Mitt Romney

carbon_footprint on August 28, 2008 at 10:16 AM

Imagine what the numbers would show, if we just started drilling for our own oil, lowering transportations costs for virtually all products.

digitalintrigue on August 28, 2008 at 10:16 AM

Biden knows about as much about the economy as he does the military. Clown Biden doesn’t know basic facts about the military either, he thinks a battallion is larger than a brigade.

This will go virtually unmentioned in our worthless media and even when it is, it will doubtlessly be coupled with the story of some down and out loser, as if those people will magically disappear when a Democrat takes office.

NoDonkey on August 28, 2008 at 10:16 AM

Orders for durable goods were also up far more than expected last month. That is a real bellwether of the economy because it means that business are planning for future growth.

Don’t look now, but home sales are also up in most parts of the country.

rockmom on August 28, 2008 at 10:17 AM

The US economy grew at an annual rate of 3.3% in the second quarter, almost twice as much as first predicted.

(dem speak) That’s just your opinion..

DaveC on August 28, 2008 at 10:17 AM

further proof the USA is the economic Epi-center of the world that all economies feed off. Can’t slow it down but so much, post-Reagan revolution

jp on August 28, 2008 at 10:18 AM

er um uh uh it is too focused to the rich….

sven10077 on August 28, 2008 at 10:18 AM

we have no leg to stand on since McCain carted out the R word a few months ago.

bloghooligan on August 28, 2008 at 10:19 AM

the paultards will still take the chicken little line, claim the growth is due to Inflation and its not ‘real growth”

jp on August 28, 2008 at 10:19 AM

I wonder what role the tax rebates played in this? Isn’t Bernanke warning the economy may not be so strong the rest of the year? We’ll have to wait and see.

cornfedbubba on August 28, 2008 at 10:20 AM

I’ve been investing all through this so-called “recession” because that’s where the value is. You don’t make money buying at the peak of the market.

Here’s where it pays off. Those of us who invested, ignored the media. We believed in America.

Those who invested in gold at its peak in March, have lost 30% of their investment since then.

Believing in America pays off in so many ways.

NoDonkey on August 28, 2008 at 10:22 AM

The US economy grew at an annual rate of 3.3% in the second quarter, almost twice as much as first predicted.

The experts were wrong again, eh? Somebody needs to hire new experts. They’re always wrong.

fossten on August 28, 2008 at 10:23 AM

ummm it is a Distraction from the real issues.

chb03c on August 28, 2008 at 10:23 AM

Of course it grew…the Messiah will be the next president!

I’m pretty sure that’s how it’s going to be spun.

Joe Comment on August 28, 2008 at 10:23 AM

check out Ron Paul on CNN last night, about “US Imperialism” and the evil Fed and how we “Create threats”, etc. oh, and the GOP and Dems are ‘just alike’

http://www.youtube.com/watch?v=BOhk0JeoZtE

nice how CNN is interested in hearing from someone who puts out the racist/conspiratorial Newsletters, buddies up with Alex Jones, etc….perfectly willing to overlook that to bash the GOP.

idiot

jp on August 28, 2008 at 10:23 AM

Does this cut out the legs from the Democrats in their non-stop themes of complaint regarding the economy?

No, because Dems don’t deal in facts, they deal in feeeeeelings. They feeeeeel that the economy is baaaaad. They feeeeeeel that the gas prices are still going up, even though in the real world, gas prices are coming down. But don’t try to confuse them with facts, they consider it impolite.

Tony737 on August 28, 2008 at 10:24 AM

Cornfedbubba, you’re right. People have been trying to dampen expectations for the rest of the year. The unknown quantity however is energy prices… if they continue to moderate it would be an immediate tax cut to the middle class and could help spur spending.

Let’s keep pushing Congress to repeal the ban on offshore drilling… that’s where much of it hinges right now.

David Rasbold on August 28, 2008 at 10:24 AM

Let’s take a close look at their record. They tried to lose the war and demoralize our military; they tried to sink the economy; and, they tried to panic the country by exploiting the price of gas and refusing to develop a workable solution. The Democrats couldn’t give a rat’s backside about the people. Their only interest is their own narcissism and the establishment of a socialist state. Unfortunately, Obama’s Kool Aid drinking lemmings are so thoroughly brain washed and indoctrinated that they have no idea what that sham political party is doing to them.

rplat on August 28, 2008 at 10:24 AM

It’s all export-related, but maybe it will shut the Dems up.

http://bigpicture.typepad.com/comments/2008/08/gdp-33.html

econavenger on August 28, 2008 at 10:25 AM

Well, if they don’t make some major moves on energy, there is going to be a major long term downturn. The system can only absorb so much, and we aren’t into winter heating season yet.

a capella on August 28, 2008 at 10:25 AM

This can’t be the Democrats keep on saying this is worse economy…evah!

Lance Murdock on August 28, 2008 at 10:25 AM

It’s going to be tough to make soup line America stick, but the Democrats will try.

tarpon on August 28, 2008 at 10:25 AM

These numbers don’t help Barry, or Michelle’s kids. They must be lies.

Vashta.Nerada on August 28, 2008 at 10:28 AM

Does that mean the donkeys are wrong about millions of Americans loading their pitiful household goods in their Model T’s and driving to California to pick vegetables?

Tantor on August 28, 2008 at 10:28 AM

It’s all export-related, but maybe it will shut the Dems up.

http://bigpicture.typepad.com/comments/2008/08/gdp-33.html

econavenger on August 28, 2008 at 10:25 AM

increase the dollar, and it would become Import related.

When you have a Trade Defecit, you need Foreign Investement back into our Economy to survive. and our Trade Defecit has ballooned thanks mostly to Oil Tripling in Cost since we import so much of it. This underscores the importance of more Energy Indpendence. Especially since Foreign Investment from many of those countries isn’t deseriable

jp on August 28, 2008 at 10:28 AM

Phill Gramm may have worded his assertion in an impolitic manner, but the latest economic data proves him correct.

I am hoping to God that the Republicans don’t go to Minneapolis next week and give us four days of soup line America, eeevil corporations speeches.

BigD on August 28, 2008 at 10:28 AM

This war is lost.

Loxodonta on August 28, 2008 at 10:29 AM

wonder were the economy would be had we did what the dems wanted, withdrew from Iraq and gave Al-Qaeda a huge victory and possibly make Oil flow/supply worse in the process

jp on August 28, 2008 at 10:31 AM

The US economy grew at an annual rate of 3.3% in the second quarter, almost twice as much as first predicted.

Oh, I’m so glad! Now I don’t have to worry about losing my home or my job! [/snark]

You’re damn right that Gramm didn’t word his language well. I’m not saying that it’s all the governments’ fault — and I don’t necessarily want bail-outs. But times are tough — even with a 3.3% gain in our economy.

Gas prices have steadily been dropping the last few weeks — but it still costs me an arm and a leg to fill up my tank.

http://thepajamapundit.com/

thePajamaPundit on August 28, 2008 at 10:31 AM

How unfortunate for the libs this is!!!

Between the war they tried to lose for us and now the pesky economy rebounding before the election they just can buy a break!

“sniff sniff”

HoosierCon on August 28, 2008 at 10:31 AM

Sorry. No depression yet. Dems are going to have to find something else to scare voters I guess.

Yakko77 on August 28, 2008 at 10:33 AM

Obviously the Bush/Cheney régime grew the economy just so they can get their guy in office.

moxie_neanderthal on August 28, 2008 at 10:33 AM

We conservatives seem to be hung up on arguing the legitimacy of the word “recession”. It doesn’t really matter whether we meet the qualifications for a recession or not. What matters is what people see and believe. People see and believe that we are either in a good economy or a bad economy. Right now, at this moment, most people believe we’re in a bad economy, me included.

Are we all so wealthy that we’re insensitive to “the pinch”? I don’t know about y’all, but I don’t know any rich Republicans personally.

While Congress-critters spar and debate whether we’re in a recession or not, and whether to put another trillion dollars into a bridge to nowhere or a refuge for abused squirrels, the rest of us are just hoping that something happens that will improve things a bit and make life a little less stressful. Congress could make a difference, but that doesn’t seem likely. We don’t really look to them for help, honestly. We just hope they don’t total screw the pooch before the economy can fix itself.

Immolate on August 28, 2008 at 10:34 AM

fossten on August 28, 2008 at 10:23 AM

Maybe those experts should be transferred to the weather desk.

jackmac on August 28, 2008 at 10:34 AM

A strong economy and a war going well = bad news for Democrats.

But don’t question their patriotism.

PattyJ on August 28, 2008 at 10:37 AM

Worst economy since Hoover.

HeHeHeHe

Elizabetty on August 28, 2008 at 10:37 AM

As an engineer in the auto industry I just got laid off for the second time in three years (which is why I’m in law school). I am struggling to find another job right now, and being in Michigan doesnt help. McCain should look at Michigan and all the things Governor Jen Jen has done to absolutely bring the economy up here to a dead standstill and bring them up time after time after time and show these socialists that it doesnt work.

ConservativeLawStudent on August 28, 2008 at 10:40 AM

Of course it grew…the Messiah will be the next president!
I’m pretty sure that’s how it’s going to be spun.
Joe Comment on August 28, 2008 at 10:23 AM

Of course. The economy moves like an oil tanker on the ocean. Any course correction takes time to show itself. George W Bush inherited the Clinton recession when he took office. Right now, the press reports on all news about the economy with a glass is half empty approach. If Obama is the president, you’ll notice the way they present the news of the economy.

Phill Gramm was absolutely correct. And the media and the democrats pushed him feet first into their wood chipper.

wise_man on August 28, 2008 at 10:44 AM

Maybe this was what McCain meant when he said that the fundamentals of the economy are basically sound. I never thought that meant no one was having problems like the Democrats have been implying. And I’m not going to vote for that amnesty whore who seems intent on eventually ruining the economy and destroying national security just to prove to Hispanics that he really cares about them.

snaggletoothie on August 28, 2008 at 10:45 AM

It doesn’t matter how much the economy grows, unless most of that growth benefits the poor, then it isn’t fair, and must be stopped.

(end DNC channeling)

MarkTheGreat on August 28, 2008 at 10:46 AM

Now I don’t have to worry about losing my home or my job

Has this country ever been in a situation where most people didn’t have to worry about losing both?

Not since we were farming the prarie, I don’t think.

Personally, I’m glad home prices are dropping. They were overpriced to begin with here in DC.

“but it still costs me an arm and a leg to fill up my tank.”

Cost me $44 to fill up my little Jetta the other day. I fill it up once a month, whether it needs it or not. This gas crisis has cost me at least $20 per month.

And what the Republicans are advocating will drop gas prices. That’s a whole lot more useful than some politician sobbing about gas prices on camera, while advocating shoveling more tax dollars at pie in the sky schemes.

NoDonkey on August 28, 2008 at 10:49 AM

As an engineer in the auto industry I just got laid off for the second time in three years (which is why I’m in law school). I am struggling to find another job right now, and being in Michigan doesnt help. McCain should look at Michigan and all the things Governor Jen Jen has done to absolutely bring the economy up here to a dead standstill and bring them up time after time after time and show these socialists that it doesnt work.

ConservativeLawStudent on August 28, 2008 at 10:40 AM

Obama and the Dems are trying to follow her lead, they plan to pass Pro-Union laws that in effect will force Unions on all companies and in effect then ship a ton of Jobs out of the country. Pure insanity

jp on August 28, 2008 at 10:50 AM

Now that is some “Change I can believe in!”

TheHat on August 28, 2008 at 10:55 AM

How can the economy be growing? The Chosen One hasn’t been crowned yet!

Vic on August 28, 2008 at 10:58 AM

And I’m not going to vote for that amnesty whore who seems intent on eventually ruining the economy and destroying national security just to prove to Hispanics that he really cares about them.
snaggletoothie on August 28, 2008 at 10:45 AM

That’s the spirit! McCain is going to ruin the whole US economy and kill us all.

I’m so glad we have so many voices of reason to keep us all on track.

wise_man on August 28, 2008 at 10:58 AM

Yea, and it came to pass that in the second quarter of the 2008th year, the One’s glory did begin to transform the economy. And it pleased the people who rejoiced in his forthcoming temple sermon.

But wo unto those, led astray by the anti-One, Ed Morrisey, who did erringly give praise to increased exports and personal spending; verily, they shall feel the burning shame of knowing they failed to be disciples of gospel of “the world as it should be”.

batter on August 28, 2008 at 11:02 AM

Not suprised, but maybe too late. For all the talk of a weak dollar, it seems that few people understand what it does for exports. (hence China keeping the yaun weak on purpose.

Now maybe if we taught economics in High School as much as we push our “racist” history……

sigh….

tottoritodd on August 28, 2008 at 11:02 AM

Obviously the Bush/Cheney régime grew the economy just so they can get their guy in office.

moxie_neanderthal on August 28, 2008 at 10:33 AM

ROFL

rockmom on August 28, 2008 at 11:05 AM

Gas prices have steadily been dropping the last few weeks — but it still costs me an arm and a leg to fill up my tank.

http://thepajamapundit.com/

thePajamaPundit on August 28, 2008 at 10:31 AM

Wait for the wind and alternative biofuel sources. Don’t drill our own oil, allow more nuclear reactors or new refineries. Just be patient,..Nancy and her Sierra Club constituency have it all figured out. We’re trying to save a planet.

a capella on August 28, 2008 at 11:06 AM

That’s the spirit! McCain is going to ruin the whole US economy

if he passes his beloved cap and trade, yes he will.

right4life on August 28, 2008 at 11:07 AM

The federal reserve cut interest rates nearly 3% in emergency moves recently. This number was revised due to export activity which was strong based on the weak dollar.

So if the argument is that the economy is strong because our dollar is weak and inflation is going to skyrocket due to interest rates that are artificially low, it is going to be the 70′s very soon. Another argument for the strong economy is that housing is up (from 30 year lows). That is the same argument that gas is cheap at $3.75/gallon.

No, we aren’t in a depression. But yes, Bush may be the first president in history to have the Dow finish below where it was when he took office. Our dollar is stronger not because our economy is stronger, but because other economies are much weaker. The British Pound has tanked over the last month as has the Euro on recession fears in Europe.

The economy is artificially propped up by a fed that has lowered interest rates too much (devaluing the dollar).

ThackerAgency on August 28, 2008 at 11:08 AM

The US economy grew at an annual rate of 3.3% in the second quarter, almost twice as much as first predicted.

Gosh, imagine that! The experts are wrong. Again. And again and again.

thekingtut on August 28, 2008 at 11:09 AM

During the Clinton administration, as a tech consultant I was scraping by looking for work and staying afloat with minimum wage jobs. When I did have a contract, it was never higher than $18.50 an hour. I paid taxes at the end of every year.

During the Bush administration, a was out of work once for 8 weeks, but was able to work for an average of $30 an hour and at times was able to also moonlight PT at the same average rate. I got tax refunds every year.

Seems obvious to me which administration was better for me personally.

Here in Phoenix, we have two basic problems (IMO): immigration and housing. Otherwise, the job market is good, commercial building continues to flourish, churches are growing — and its a dry heat!

Mr_Magoo on August 28, 2008 at 11:13 AM

Dems have to spin everything – otherwise they have no hope of taking back the White House. It’s just politics.

I’m sure during the Clinton admnistration, they spun everything to the “peachy” side or blamed the Republican Congress.

Mr_Magoo on August 28, 2008 at 11:21 AM

Believing in America pays off in so many ways.

NoDonkey on August 28, 2008 at 10:22 AM

B-b-but it’s the freakin’ Dust Bowl out here in America! Tonight’s dinner: lawn grass and boiled shoes. It has to be true, the TV said so!

(Two words: buying opportunity. Heh.)

Gilda on August 28, 2008 at 11:22 AM

Hey I know lets make the economy better by electing obama and socializing the nation…yeah that sounds good.

elduende on August 28, 2008 at 11:22 AM

comparing this economy to the 1970′s and thinking the Fed is some all powerful central controller of all things is absolutely absurd and disengenous.

See George Mason Econ Dept. head over at Cafe Hayek explain:

http://cafehayek.typepad.com/hayek/2008/07/times-arent-70s.html

We can debate just how closely the economy of 2008 parallels that of the 1970s (“Today’s crunch feels like ’70s,” July 13). But one big difference unquestionably – and happily – distinguishes today from the dismal days of disco: no wage and price controls. This fact alone goes far toward making our prospects today brighter than they were during the presidencies of Nixon, Ford, and Carter. No inflation camouflaged by government fiat, and no long lines at gasoline stations or anxiety about finding fuel.

Plus, we’re much wealthier today. Those who doubt this truth can get any Sears catalog from the 1970s, study it, and ask if they’d prefer to use their 2008 incomes to buy 1970s-era products at 1970s prices, or buy today’s products at today’s prices. Even though nominal prices in the 1970s were much lower than prices today, very few persons would choose the 1970s option.

Sincerely,
Donald J. Boudreaux

follow the link to the 1970′s Sears Catolougue.

some things are much more powerful than the Federal Reserve. Trade Policy, Wal-Mart effect, increased Productivity, no Price controls, Tax Rates, etc.

we are doing pretty good

jp on August 28, 2008 at 11:23 AM

The Christmas shopping season is just around the corner as well. I’m guessing that if Obama wins, it will be one of the better years on record because there is ‘hope and change’ on the horizon.

If McCain wins, it will be a dark day in the retail market because things are still so very bad. Either way, it’s going to keep things growing, no matter how the MSM spins it.

The economy is fine…it isn’t perfect, but the best thing the government can do is just get out of the damn way and leave it alone.

Asher on August 28, 2008 at 11:25 AM

OK, there is a Republican convention next week. There is another Katrina barrelling down on the Gulf Coast that will likely hit on Tuesday.

How many geniuses posting here think it will be a good idea to tout how well our economy is doing next week? How many people here think it will be a good idea to say . . . Bush was so good on the economy that McCain will continue doing what has worked so well.

The government really has little impact on the ebbs and flows of a capitalistic economy. They take credit and blame for an economy that is really out of their control. Clinton wasn’t the reason for the 90′s and Bush isn’t the reason for the problems during the last decade.

But saying that we are doing GREAT is political suicide. Go down to New Orleans next Wednesday and tell them how good the economy is. . . if you want to lose an election.

ThackerAgency on August 28, 2008 at 11:28 AM

Go down to New Orleans next Wednesday and tell them how good the economy is

new orleans, like michigan, should be touted as the fruits of liberal democrats. they’ve run michigan, and detroit, for a long, long time…and they’ll do for the rest of us, what they’ve done for detroit.

right4life on August 28, 2008 at 11:33 AM

right4life, New Orleans will be a lake again next Wednesday no matter how corrupt their government is. . . that’s the point. And it will remind America of the incompetence of the Bush administration. This hurricane is coming at a bad time for the Republicans. Fortunately Jindal is on top of the situation already. . . but there’s little he can do to shore up the weak levies. All we can do is pray for New Orleans and hope that God shows mercy.

ThackerAgency on August 28, 2008 at 11:37 AM

Thacker -you into predicting the weather now?

vinman on August 28, 2008 at 11:40 AM

thePajamaPundit on August 28, 2008 at 10:31 AM

Again, I renew the objection to your redundant plugging of your website. It’s not like everybody knows you’re copycatting Pajamas Media, anyway.

I think, so that we can tell you apart from PM, I shall call you PeePee.

fossten on August 28, 2008 at 11:41 AM

*should be “everybody doesn’t know”

fossten on August 28, 2008 at 11:42 AM

And it will remind America of the incompetence of the Bush administration

but it should remind them of the incompetence of school-bus nagin, and whoever the demo governor was at the time.

this time jindal is governor, watch a totally different outcome, and silence from the drive-bys.

I never thought it showed the ‘incompetence’ of the bush administration, thats what governors, and mayors are for, or why bother to have them? its just more of the liberal mind-set, wait for the guvmint to save them…if they’re that stupid, then let em drown.

right4life on August 28, 2008 at 11:42 AM

I think 25% John Edwards was solely responsible for…and Fred Baron.

benrand on August 28, 2008 at 11:44 AM

A growth rate of 3.3% is a good, solid number, one that exceeds inflation and shows real substance in the economy.

The 3.3% rate is reported as the rate of real GDP growth, which is already net of inflation.

Kralizec on August 28, 2008 at 11:54 AM

The problem is, despite the numbers, people don’t FEEL it. Still under the influence of Mr. Peanut’s “malaise” 30 years later.

But as someone here said, drill for oil and watch 250,000 jobs in energy, construction and transportation get created lickety split. Then we’ll see how people feel.

J.J. Sefton on August 28, 2008 at 11:59 AM

The 3.3% rate is reported as the rate of real GDP growth, which is already net of inflation.

Kralizec on August 28, 2008 at 11:54 AM

yep, the anti-Fed cranks come back though with “real Inflation” is double digits and is masked by the all powerful and evil Federal Reserve.

They don’t give a rip about Economics, just are anti-Govt. and anti-Fed to the point of being idiots

jp on August 28, 2008 at 12:01 PM

CNBC is reporting that the 3.3% growth was “adjusted” to 1.9%

Pcoop on August 28, 2008 at 12:09 PM

I never thought it showed the ‘incompetence’ of the bush administration, thats what governors, and mayors are for, or why bother to have them? its just more of the liberal mind-set, wait for the guvmint to save them…if they’re that stupid, then let em drown.

right4life on August 28, 2008 at 11:42 AM

I PERSONALLY agree with this. This could be a place where Jindal could shine. But still there is very little that can be done if a major hurricane makes a direct hit other than stock up on Sham-Wow’s.

The incompetence is their not knowing that there were people in need of rescue in the place that they were told to go to be rescued. ‘You’re doing a heckuva job, Brownie’ didn’t become a catch phrase for nothing.

ThackerAgency on August 28, 2008 at 12:55 PM

Oabamessiah has spoken to the economy and the economy has responded. Governor Tim Kaine of Virginia was quoted as saying, “I am glad to see that the economy has complied with the request made by Senator Obama.” So let it be written…so let it be done.

sdd on August 28, 2008 at 1:06 PM

Economy grew 3.3% in Q2

You can believe the GDP revision to 3.3% growth for Q2 to the same degree that you can believe that inflation is running at an annual rate of 1.2%, which is what was used for the deflator to calculate the GDP revision.

And if you believe that, I have got ocean front property in Kansas to sell you.

MB4 on August 28, 2008 at 1:31 PM

That’s good news but calling it the “Clinton recession” just reduces you to the level of those that call it the Bush recession. Neither one of them had anything to do with it.

Benaiah on August 28, 2008 at 1:38 PM

This person thanks Bush for his opportunities.
Scroll down and click on, Wednesday Aug 27 2008 Repo Man Episode: #04108 Views: 4281
You may have to watch a 15 sec ad first. “Repo Man” starts at 1:15 min into clip. Although the lead up to 1:15 is pretty funny.

Chimpy on August 28, 2008 at 1:50 PM

I wonder what role the tax rebates played in this? Isn’t Bernanke warning the economy may not be so strong the rest of the year? We’ll have to wait and see.

cornfedbubba on August 28, 2008 at 10:20 AM

Record exports and the temporary stimulus from the tax rebates prevented the economy from stalling as housing slumped and companies cut expenditures. Consumer spending is now waning and slower growth abroad dims the outlook for foreign sales, signaling last quarter will be the year’s highpoint.

“Outside of trade, the economy is considerably weaker,” said Carl Riccadonna, an economist at Deutsche Bank Securities Inc. in New York. “When you look at the spending, it looks terrible for the second half of the year.”
- Bloomberg

MB4 on August 28, 2008 at 1:55 PM

Straight talk.

I will speak with a straight tongue. I have heard talk and talk, but nothing is done. My father was the first to see through the schemes of this man. My father had sharper eyes than the rest of our people.

Hinmahtooyahlatkek on August 28, 2008 at 2:19 PM

That’s good news but calling it the “Clinton recession” just reduces you to the level of those that call it the Bush recession. Neither one of them had anything to do with it.

Clinton had nothing to do with the booming economy in the late 90′s either, but he almost broke his arm patting himself on the back for it.

Clinton was a terrible President. He deserves to be beaten with any stick that’s available at the time.

NoDonkey on August 28, 2008 at 2:26 PM

Captain Ed:

The doom of the GOP is blindly believing the government spin on the economy.

Let’s see, the gov’t borrowed money to issue stimulus checks, and consumers ramped up their credit card bills while skipping payments on their mortgages.

And consumers are 70% of the economy.

So we borrowed a quarter’s worth of growth for the GDP to maintain an illusion of economic health. And it is an illusion – the last 3 years of apparent prosperity was ALL BORROWED and financed by bull**** loans.

This is good news?

olddeadmeat on August 28, 2008 at 2:51 PM

A growth rate of 3.3% is a good, solid number, one that exceeds inflation and shows real substance in the economy.

The 3.3% rate is reported as the rate of real GDP growth, which is already net of inflation.

Kralizec on August 28, 2008 at 11:54 AM

Not quite. CPI is a white lie morphed into a total fraud, as everyone pretty much knows now. But the GDP figure is actually produced using a price index that’s deviating even from that to create an almost Orwellian statistic of plenty.

http://bigpicture.typepad.com/comments/2008/08/are-you-measuri.html

Luckily the incumbent Dems play the game too because they need reelected as well. Clinton and Greenspan are the ones who really started the slippery slope we’re on anyhow. Because of them, in order to produce these pleasing looking numbers for the restless voting masses you must unfortunately continually accelerate the statistical fraud. It does have a beneficial aspect though to increase confidence and keep people spending when otherwise they would tighten the belt.

There’s no wage price spiral because worker leverage is gone compared to the 70s. Thus the need for helicopter drop stimulus checks keep the economy from crashing. They have to do that or else artificially inflate wages to keep things from grinding to a halt.

econavenger on August 28, 2008 at 3:06 PM

We’re all DOOOOOOOOOOOOOOMED.

Geez these threads are so predictable.

Every time we get the same stuff about how the books were cooked and next quarter things are REALLY going to go to hell in a breadbasket.

And then the next quarter we get the same stuff about how the books were cooked and next quarter things are REALLY going to go to hell in a breadbasket.

Etc.

Well, if you bought $1000 worth of gold in March you lost $700. Being a chicken little doesn’t pay.

NoDonkey on August 28, 2008 at 3:34 PM

MB4, what’s your deal man? When there’s positive news in Iraq, you don’t like it. When there’s positive news in the economy, you don’t like it.

SoulGlo on August 28, 2008 at 4:09 PM

Well imagine that…

The sky isn’t falling after all…

I wonder what the next “hell in a handbasket” crisis will be???

RocketmanBob on August 28, 2008 at 5:16 PM

Well, if you bought $1000 worth of gold in March you lost $700. Being a chicken little doesn’t pay.

NoDonkey on August 28, 2008 at 3:34 PM

How so? It closed at about $840 today.

dedalus on August 28, 2008 at 5:58 PM

The Dems will say it is because of the “Stimulus Package”.

AlreadyKnownAs on August 28, 2008 at 6:03 PM

NoDonk,

The books have always been cooked, so you’ll hear that every month of the rest of your life probably. Only now are major investigative articles and documentaries being published to expose the depth of it. Both parties know the deal. We live as well as we do by recklessly ignoring GAAP and fortunately getting others to hold dollars in reserve to compensate. It’s just that the need to adjust figures becomes greater and greater to address a troubled dollar and flawed policy decisions that were based on the previous round of numbers. Clinton and Greenspan just made it much worse long-term now for us so they could create a worthless short-term legacy for themselves.

Other nations now trading dollars for banking assets is what’s keeping the financial system afloat. The competitive devaluation of other currencies has also kicked in to prevent the dollar from collapsing. We’re good…for now.

But for those who know what’s going on, the real bad economic news has never been forecast to hit before the election. The real estate, financial sector and banking system near-collapse was predicted and arrived, then this period of recovery was predicted and arrived. Then comes the debt deflation day of reckoning. The few people who knew how the entire system would react when under stress are still tracking 100% on their predictions and will remain at 100% when it’s over. The only variable now is a policy choice for a quicker hard or a slow crash depending on who’s elected and how bad it is in other nations. Quicker is preferred.

Putting your head in the sand won’t help your family survive trouble. Just think of the billions in total conservative wealth Rush Limbaugh had a hand in destroying the last 12 months by alleging that it was all an MSM conspiracy. Rush is right 99% of the time, but on this he was a total bufoon.

econavenger on August 28, 2008 at 6:38 PM

The Dems will say it is because of the “Stimulus Package”.

AlreadyKnownAs on August 28, 2008 at 6:03 PM

The truth is probably more like “in spite of…”
Investment drives the economy, not consumption. Borrowing money to give “tax credits” sounds like a tax cut, but, unless all of that money is in tern invested (in things with a better rate of return than US bonds), it on net drains capital investment, slowing the economy.

So I’m glad to hear the economy is doing well anyway.

Count to 10 on August 28, 2008 at 8:23 PM

econavenger on August 28, 2008 at 6:38 PM

Thank you for your postings on this thread!

Incidentally: is M3 now gone forever? Did the Fed finally pull the plug & stop reporting this for good? (IYO is this relevant and/or related to the alleged manipulation of economic data by the Fed?)

RD on August 28, 2008 at 8:25 PM

M3 isn’t coming back officially. No political interest groups for it. ;) There’s some argument for it not being as relevant these days, but there’s no real good reason to have stopped it. It’s information that people still seek to make investment decisions. That’s the biggest problem we face as a nation. It’s literally impossible to make a good decision when we’re blocking or ignorantly modifying the information we need. It’s especially pernicious with inflation because it can take hold and rocket out of control before you can say “oops.” So far M3 is showing hyperinflation danger is in check. But say it took off in that direction. Could we take the brave Paul Volker route and stop it by running the prime rate over 20%? Not now we couldn’t. We would probably choose hyperinflation voluntarily as the lesser evil.

Here’s a good current article on M3 and the two primary alternative stat sources.

http://www.minyanville.com/articles/dollar-euro-money-currency-M3-contraction/index/a/18609

econavenger on August 28, 2008 at 9:22 PM