From www.bea.gov
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 0.6 percent in the fourth quarter of 2007,
according to advance estimates released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 4.9 percent.
Soo the economy went from 4.9% annual growth rate to a ground crawling 0.6% annual rate. Keep in mind that this is the "advance" GDP number which has generally been revised downward as of late. Two negative quarters are described as a recession. The country may escape a "technical" recession but to most Americans were are in a severe recession and to those that have lost their job or their house, this is a depression.
The Bureau emphasized that the fourth-quarter "advance" estimates are based on source data that
are incomplete or subject to further revision by the source agency (see the box on page 3). The fourth-
quarter "preliminary" estimates, based on more comprehensive data, will be
released on February 28, 2008.
The increase in real GDP in the fourth quarter primarily reflected positive contributions from personal consumption expenditures (PCE), nonresidential structures, state and local government
spending, exports, and equipment and software that were largely offset by negative contributions from private inventory investment and residential fixed investment. Imports, which are a subtraction in the
calculation of GDP, increased slightly.
Governemnt had to spend to prop up the economy, while the GDP was "offset" by negative contributions from residential fixed investment.
The deceleration in real GDP growth in the fourth quarter primarily reflected a downturn in inventory investment and decelerations in exports, in PCE, and in federal government spending that
were partly offset by a deceleration in imports and an acceleration in state and local government spending.
Motor vehicle output subtracted 0.90 percentage point from the fourth-quarter growth in real GDP after contributing 0.36
percentage point to the third-quarter growth.
Car sales are down, here in Michigan we have been feeling the effects for years. The state has lost about 400,000 manufacturing jobs since 2000, our population has shrunk by 0.2% the only state in the union next to Rhode Island to lose population.
This news release is available on BEA's Web site at www.bea.gov/newsreleases/rels.htm.
Real personal consumption expenditures increased 2.0 percent in the fourth quarter, compared with an increase of 2.8 percent in the third. Durable goods increased 4.2 percent, compared with an
increase of 4.5 percent. Nondurable goods increased 1.9 percent, compared with an increase of 2.2 percent. Services expenditures increased 1.6 percent, compared with an increase of 2.8 percent.
Real nonresidential fixed investment increased 7.5 percent in the fourth quarter, compared with an increase of 9.3 percent in the third. Nonresidential structures increased 15.8 percent, compared with an
increase of 16.4 percent. Equipment and software increased 3.8 percent, compared with an increase of 6.2 percent. Real residential fixed investment decreased 23.9 percent, compared with a decrease of 20.5
percent.
The decreases in residential fixed investment was huge and by far the largest drag on the economy. The stimulus package may help but legislation targeting the housing sector. I think matching grants to help people make down payments on homes could be helpful to spark purchases and getting the housing market moving again. The market is seized up because people who want to sell to buy another bigger house can't because to many buyers are sitting on the fence. Anyway, I think better more creative ideas are needed but definately not more of the toxic exotic loans the GOP and banking sector have been pushing over the past few years. Housing is a sector were a progressive revolution of new ideas is needed.
Real exports of goods and services increased 3.9 percent in the fourth quarter, compared with an increase of 19.1 percent in the third. Real imports of goods and services increased 0.3 percent,
compared with an increase of 4.4 percent.
Real federal government consumption expenditures and gross investment increased 0.3 percent in the fourth quarter, compared with an increase of 7.1 percent in the third. National defense decreased 0.6
percent, in contrast to an increase of 10.1 percent. Nondefense increased 2.2 percent, compared with an increase of 1.1 percent. Real state and local government consumption expenditures and gross
investment increased 4.0 percent, compared with an increase of 1.9 percent.
Real final sales of domestic product -- GDP less change in private inventories -- increased 1.9 percent in the fourth quarter, compared with an increase of 4.0 percent in the third.
Gross domestic purchases
Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever produced -- increased 0.2 percent in the fourth quarter, compared with an increase of 3.3 percent in the
third.
The personal saving rate -- saving as a percentage of disposable personal income -- was 0.2 percent in the
fourth quarter, compared with 0.6 percent in the third. Saving from current income may be near zero or negative when outlays are financed by borrowing (including borrowing financed through credit cards or
home equity loans), by selling investments or other assets, or by using savings from previous periods.
The savings rate is truly attrocious and reflects the poor wage growth for the average American and the over reliance on credit to supplant rising expenses and shortfalls in wages. Bush and the GOP have markedly shifted the wealth of the country to a tiny, tiny minority of people and the entire economy is flailing under the pressure of this foolish, flawed and dangerous economic scam.
BEA's national, international, regional, and industry estimates; the Survey of Current Business;and BEA news releases are available without charge on BEA's Web site at www.bea.gov. By visiting
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Next release -- February 28, 2008, at 8:30 A.M. EST for:Gross Domestic Product: Fourth Quarter 2007 (Preliminary)