Deception alert: Sorry, AP, 'sluggish' growth doesn't make economy 'sturdier'

Cain TV.com ^ | July 28, 2014 | Herman Cain

[Wyatt's Torch]

We will know in 11 hours :-) I still say ~3%. Regardless of what it is people here will freak out and say the books are cooked. That is a dead lock certainty 😎

[xzins]

The books are cooked. :>)

Last quarter, it turned out to be down 3%.

As compared to what?

[quimby]

Thanks for your comments. The US economy is resilient often in spite of government policy. The recovery hasn’t been strong, and is regional so may areas are in recession. It really doesn’t ‘feel’ like recovery to many. And its nowhere near its potential for political reasons.

[Wyatt's Torch]

Exactly right! It could be so so so much better but this President has created the most anti-business environment in history. And in spite of that there are a lot of positives (long way to go). That is the American resilience of which you speak.

[Wyatt's Torch]

+4%

[Wyatt's Torch]

Also 1Q14 revised to -2.1%

At the end of the day we are looking at 1.5-2.0 annual growth. Growth but weak growth. Where we have been for the last few years: Tallest midget economy - Worst recovery in US history.

[xzins]

Was last quarter of 2013 at 4%, so economy retracted 2.9% from that? Do I have that right?

[Wyatt's Torch]

4Q13 was also revised up but the number are year-over-year not sequential.

[xzins]

There has to be a previous number from which the GDP contracts to show that it has fallen or from which it expands to show that it has risen.

Wouldn’t that be the previous quarter’s number?

[Wyatt's Torch]

Both potentially. Here is the FRED chart that still shows the last 1Q14 number so you can see it fall:

When they revise their data later this morning you will see it go up. The headline numbers though are YOY not sequential.

[xzins]

In 2 quarters of decline, for example, the 1st quarter fell from the previous 4th quarter, and the 2nd quarter fell even more from the 1st quarter number. That would give you an official pattern of falling.

Am I correct?

[Wyatt's Torch]

BEA defines a recession as two consecutive quarters of negative YOY growth.

[xzins]

If a hypothetical year ended at 15,000,000,000,000, and the first quarter of the next year ended at 14,700,000,000 then that would be a 2% decline.

If the 2nd quarter of that hypothetical year also ended at 14,700,000,000 would that also be a 2% decline from that 15,000,000,000,000? Or would it be zero growth, zero decline since it would be the same number?

[Wyatt's Torch]

Here is the updated graph from FRED showing 2Q14: