Gross domestic product shrank in third quarter of 2000 (Clinton / Gore recession sooner than later)

MSNBC ^ | 12/11/03 | AP

[Steven W.]

The longest economic expansion in U.S. history faltered so much in the summer of 2000 that business output actually contracted for one quarter, the government said Wednesday in releasing a comprehensive revision of the gross domestic product.

BASED ON NEW DATA, the Commerce Department said that the GDP — the country’s total output of goods and services — shrank by 0.5 percent at an annual rate in the July-September quarter of 2000. Previously, the government had said GDP was rising at a weak annual rate of 0.6 percent during that quarter.

The GDP returned to positive territory in the October-December quarter of 2000, rising at an annual rate of 2.1 percent, before slipping back into negative territory in the first quarter of 2001. The first, second and third quarters of 2001 all experienced falling GDP as the country slogged through its first recession since 1990-91.

The National Bureau of Economic Research, the official arbiter of when recessions begin and end, has determined that the recession began in March 2001 and ended in November of that year.

It is not expected to change those dates based on the revised GDP data because the NBER relies on monthly data, rather than quarterly statistics, to better pinpoint when recessions begin and end. Economists also generally believe that GDP must contract for two consecutive quarters for a period of economic weakness to be called a recession.

Still, the GDP revisions are certain to be used by administration officials to bolster their contention that President Bush inherited a recession when he took office in January 2001, even though the downturn did not officially begin until two months after he took office.

Even before the revisions, the GDP data showed that the economy, which had been surging ahead, hit a brick wall in the summer of 2000 with growth slowing sharply, partly as a result of the bursting of the stock market bubble in early 2000.

[My2Cents]

2000...Worst economy in over a century.

[MegaSilver]

2000...Worst economy in over a century.

I still think it's funny that people keep saying that "Bush trashed the economy." As if the tech stock debacle of 2000 wasn't prime indicator that we were LOOOONG overdue for a recession, and that it was about to hit us right in the face.

[MarkeyD]

How do you expect Democrats to know about the Clinton Stock Market Crash? Social Security is a much better long term investment, you know.

[fhayek]

I am always amazed by the number of media types who seem to act as if there has never been a recession before. No one likes recessions, to be sure, but how many times in history have we gone 8 years or so without having a recession? Labeling this the Bush recession is just plain absurd.

[RightWhale]

When did the Fed start contracting the overnight bank rate? About then?

[My2Cents]

Not only this, but considering the Enron-like scandals...the accounting practices which blew up in the face of corporate America (or certain members of corporate America) were practices that occurred during the Clinton years. Imagine that: lying and spinning to save one's behind...Where have we seen that before? If anything, the Bush Administration should be given credit for making these corporate crooks pay for their misdeeds done in the 1990s.

[Jackson Brown]

Still, the GDP revisions are certain to be used by administration officials to bolster their contention that President Bush inherited a recession when he took office in January 2001, even though the downturn did not officially begin until two months after he took office.

The author of this piece must be a complete idiot! I could list a dozen obvious reasons why I say this, but one obvious reason is what he calls the "official beginning" -- at the end of Q1 2001 -- measures what started at the beginning of the quarter...it did not "start" at the end! (Also I must ask: how in the world can anyone think that a recession gets started in just 2 months? The seeds -- and "germination" -- of the recession was in the "busted" bubble that was created though out the 90s!)

[Jorge]

Ping for later reading

[GOPJ]

bump

[fhayek]

Yeah, and doesn't it stand to reason that if 4 out of 5 quarters (beginning in July 2000)showed contractions, just maybe there is some relationship there. The economy was obviously running out of gas before Bush was even elected.