GDP Down, Despite Govt. Manipulation; 3 yrs Net Negative Econ Growth

Today's GDP report certainly shows there's been no "recession" in creativity at the BEA. In fact, their creative geniuses are in top form, demonstrated abundantly in the calculation of 2nd quarter GDP.

The reported GDP decrease was "only" -1.0%, but this was the product of extensive revisions to previous numbers.

The typical GDP report is only 13-14 pages in pdf format. But today it was 51 pages. The additional pages were needed to describe the revisions. By design, it's very difficult to determine what was done, and even which direction some of the revisions were in.

A brand new problem is the change in the measurement of real GDP. Starting this quarter—the 2nd quarter of 2009—the BEA has shifted from measuring real (inflation-adjusted) GDP in
"chained 2000 dollars", to using "chained 2005 dollars." This increases ALL of the previous real GDP stats that are shown on this report. This makes comparing it with the previous quarter's report almost impossible.

Using the most easily interpretable of the BEA's numbers--the % change in real GDP—it does appear that the BEA has again downwardly revised previous GDP readings. Mathematically, this makes this month's decline less. For example, the decline in 1st quarter GDP was changed from the previously published decline of -5.5% down to -6.4%. Assuming this means that the measured GDP was -0.9% worse than previously estimated, then this is was -0.9% that would have otherwise been added to the current quarter's decline.

Adding this -0.9% to the currently published -1.0% would give a decline of -1.9% for the 2nd quarter of 2009.

Reviewing more of the report, the downward revisions for 2008 indicate the economy did much worse than originally reported. Below is a modification of table 2A from the BEA's latest GDP report (page 24):



Normally I could subtract the current real GDP in dollars from that of the previously published data for 4th quarter 2007, and get a total real $ amount for the change. Then I'd divide that change by total real GDP for Q4 2007, and get the % decline.

But I can't do that here, since the originally posted stats for Q4 2007 real GDP are in chained 2000 dollars, while the current numbers are in the new "chained 2005 dollars." In addition, I can't even determine how much the real numbers were changed since 2007, for the same reason.

Though it may be inadvertent, the BEA has certainly covered its tracks quite well on this one.

There is, however, one table in the current report that is striking. This is Table 3B (Real GDP & Related Measures on page 26). From this table, it appears that real GDP for Q2 of 2009 is less than that of Q1 2006. The listed GDPs rise from Q1 2006's $12.915 trillion until Q2 2008's GDP of $13.415 trillion. Since then they've fallen, with today's GDP of only $12.892 trillion.




What all of this means is that the US has had 0 net GDP growth over the last 3 years. Today's real GDP is now less than it was in the 1st quarter of 2006.

According to today's report, real GDP has declined -4.0% over the last year (from 2nd quarter 2008 to 2nd quarter 2009.) The decline in Q2 GDP marks the 4th straight quarter of GDP declines, which is a record that hasn't been seen since 1947, when these statistics 1st started being recorded.

From today's report it is even more obvious that our economy is doing poorly, and has been doing poorly for quite some time. With an annual GDP decline of -4%, job losses of 7 million, and no net GDP growth for the last 3 years, we are not experiencing just a "normal" recession. We're in a severe recession at the least, and more likely we're in a 2nd Great Depression.

So, our new and improved numbers are made to fit the administration's talking points. De je vu all over again.

But our 2nd REPUBLICON Great Depression is the fundamental thing
as time goes by........

And I say that with every bit of sincerity and genuineness that I could possibly muster.

:hug:

Add one more voice of sanity and reason that this place so desperately needs right now.

and girl gone mad, dixegrrrrl, Joanne98, etc. KEEP POSTING and shining the light.

At some point even willful Ignorance is not completely Invincible.

I appreciate the compliment.

A depression is a quarterly decline of greater than 10% or three consecutive years of decline NOT a 3 year net decline.

The entirety of the second chart is in chained 2005 dollars.

Generally recognized that is..and reprted on corporate media. Bush says economy strong despite housing woes


http://www.cnbc.com/id/24016186">Greenspan Says Fed Didn't Cause Housing Bubble


http://www.bloomberg.com/apps/news?pid=20601087&sid=aUjHT5Z7rF00">Greenspan Says Politics Drove Bush's Economic Agenda
Greenspan saved his harshest analysis for the current president. Soon after Bush took office in 2001, the president set about implementing a campaign promise to cut taxes, a policy Greenspan said he believed at the time wasn't well conceived.

"Little value was placed on rigorous economic policy debate or the weighing of long-term consequences," he wrote.

In 2001 testimony before Congress, Greenspan was widely interpreted to have endorsed Bush's proposal to cut taxes by $1.6 trillion over 10 years. In the book, he characterized his testimony as politically careless and said his words were misinterpreted.
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Greenspan saved his harshest analysis for the current president. Soon after Bush took office in 2001, the president set about implementing a campaign promise to cut taxes, a policy Greenspan said he believed at the time wasn't well conceived.