GDP Expanded at 4.2% Rate in Second Quarter
Corporate Profits Also Surged, Rising 6% from the First Quarter to an Annual Rate of $1.840 Trillion
Ben Leubsdorf. August 28, 2014. Retrieved from http://online.wsj.com/articles/gdp-expanded-at-4-2-rate-in-second-quarter-1409229416 Gross Domestic Product The purpose of Mr. Leubsdorf’s article was to explain how the current GDP exceeded prior expectations. Ben went into great detail about the encouraging direction of not only the GDP but also of unemployment. The overall feeling of the article was that though “The worst recession since the Great Depression ended in June 2009, but the recovery has been slow and halting. The second-quarter rebound assuaged worries about a prolonged slowdown following the first quarter's stumble”. Though these current numbers are encouraging Mr. Leubsdorf warns that this current acceleration is not likely to be sustained.
Summary
The estimate of the current GDP back in December was 2.8% to 3.2%, and was then downgraded in June to 2.1% to 2.3%. The actual growth of 4.2% was a welcome surprise to economists as was the 200,000 jobs added in 6 consecutive months. Ben attributes this to consumer purchasing growth in items such as new cars as well as businesses spending on new buildings and equipment. The unintended consequence to this information could be a positive one in which it creates consumer confidence and furthers this steady incline of GDP numbers. Though the growth is at this point slow, it is heading the right direction. Climbing out of the 2007 recession has been at times compared to climbing out of a sand pit, the current numbers can be seen as encouraging.
U.S. Jobs Report: 288,000 Positions Added
Unemployment Falls to 6.1% as Prior Months' Gains Revised Upward
Jonathan House. July 4, 2014. Retrieved from