The Coming Obama Recession — Real Recession — Real Recovery Needed –Videos
Table 1.1.1. Percent Change From Preceding Period in Real Gross Domestic Product
[Percent] Seasonally adjusted at annual rates
Last Revised on: January 30, 2013 – Next Release Date February 28, 2013
|1||Gross domestic product||2.3||2.2||2.6||2.4||0.1||2.5||1.3||4.1||2.0||1.3||3.1||-0.1|
|2||Personal consumption expenditures||2.5||2.6||2.5||4.1||3.1||1.0||1.7||2.0||2.4||1.5||1.6||2.2|
|7||Gross private domestic investment||19.8||14.6||16.4||-5.9||-5.3||12.5||5.9||33.9||6.1||0.7||6.6||-0.6|
|11||Equipment and software||14.7||12.0||11.9||9.2||11.1||7.8||18.3||8.8||5.4||4.8||-2.6||12.4|
|13||Change in private inventories||—||—||—||—||—||—||—||—||—||—||—||—|
|14||Net exports of goods and services||—||—||—||—||—||—||—||—||—||—||—||—|
|21||Government consumption expenditures and gross investment||-3.1||2.8||-0.3||-4.4||-7.0||-0.8||-2.9||-2.2||-3.0||-0.7||3.9||-6.6|
|25||State and local||-5.5||-1.4||-2.9||-4.6||-4.7||-3.2||-2.0||-0.7||-2.2||-1.0||0.3||-0.7|
|26||Gross domestic product, current dollars||3.9||4.1||4.6||4.5||2.2||5.2||4.3||4.2||4.2||2.8||5.9||0.5|
Peter Schiff on Negative 4th QTR GDP “The Temporary Euphoria Of The Stimulus
Marc Faber ‘Correction is Overdue’
GDP Drops -0.1% In 4th Quarter – State Of The Economy – America In Crisis!
Surprise Q4 fall in US GDP
Rick Santelli Reacts To Negative Fourth Quarter GDP Growth: ‘We Have Become
The Economy Shrank 0.1% Last Quarter – That’s Not Good IMO – John D. Villarreal
Carney: GDP report not “good news”
US GDP drop dents FTSE’s good form– IG’s Afternoon Market Headlines 30.01.13
US economy shrinks for first time since 2009.
John Williams: We’re Going to be in a New Recession in 2013
Marc Faber. – US Economy 100% Chance of Another Recession
Recession Risks: UK heads for triple-dip as GDP shrinks
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Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- decreased at an annual rate of 0.1 percent in the fourth quarter of 2012 (that is, from the third quarter to the fourth quarter), according to the "advance" estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 3.1 percent. The Bureau emphasized that the fourth-quarter advance estimate released today is based on source data that are incomplete or subject to further revision by the source agency (see the box on page 4 and the "Comparisons of Revisions to GDP" on page 5). The "second" estimate for the fourth quarter, based on more complete data, will be released on February 28, 2013. The decrease in real GDP in the fourth quarter primarily reflected negative contributions from private inventory investment, federal government spending, and exports that were partly offset by positive contributions from personal consumption expenditures (PCE), nonresidential fixed investment, and residential fixed investment. Imports, which are a subtraction in the calculation of GDP, decreased. The downturn in real GDP in the fourth quarter primarily reflected downturns in private inventory investment, in federal government spending, in exports, and in state and local government spending that were partly offset by an upturn in nonresidential fixed investment, a larger decrease in imports, and an acceleration in PCE. Final sales of computers added 0.15 percentage point to the fourth-quarter change in real GDP after adding 0.11 percentage point to the third-quarter change. Motor vehicle output added 0.04 percentage point to the fourth-quarter change in real GDP after subtracting 0.25 percentage point from the third-quarter change. _____________ FOOTNOTE. Quarterly estimates are expressed at seasonally adjusted annual rates, unless otherwise specified. Quarter-to-quarter dollar changes are differences between these published estimates. Percent changes are calculated from unrounded data and are annualized. "Real" estimates are in chained (2005) dollars. Price indexes are chain-type measures. This news release is available on www.bea.gov along with the Technical Notes and Highlights related to this release. _____________ The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 1.3 percent in the fourth quarter, compared with an increase of 1.4 percent in the third. Excluding food and energy prices, the price index for gross domestic purchases increased 1.1 percent in the fourth quarter, compared with an increase of 1.2 percent in the third. Real personal consumption expenditures increased 2.2 percent in the fourth quarter, compared with an increase of 1.6 percent in the third. Durable goods increased 13.9 percent, compared with an increase of 8.9 percent. Nondurable goods increased 0.4 percent, compared with an increase of 1.2 percent. Services increased 0.9 percent, compared with an increase of 0.6 percent. Real nonresidential fixed investment increased 8.4 percent in the fourth quarter, in contrast to a decrease of 1.8 percent in the third. Nonresidential structures decreased 1.1 percent; it was unchanged in the third quarter. Equipment and software increased 12.4 percent in the fourth quarter, in contrast to a decrease of 2.6 percent in the third. Real residential fixed investment increased 15.3 percent, compared with an increase of 13.5 percent. Real exports of goods and services decreased 5.7 percent in the fourth quarter, in contrast to an increase of 1.9 percent in the third. Real imports of goods and services decreased 3.2 percent, compared with a decrease of 0.6 percent. Real federal government consumption expenditures and gross investment decreased 15.0 percent in the fourth quarter, in contrast to an increase of 9.5 percent in the third. National defense decreased 22.2 percent, in contrast to an increase of 12.9 percent. Nondefense increased 1.4 percent, compared with an increase of 3.0 percent. Real state and local government consumption expenditures and gross investment decreased 0.7 percent, in contrast to an increase of 0.3 percent. The change in real private inventories subtracted 1.27 percentage points from the fourth-quarter change in real GDP after adding 0.73 percentage point to the third-quarter change. Private businesses increased inventories $20.0 billion in the fourth quarter, following increases of $60.3 billion in the third and $41.4 billion in the second. Real final sales of domestic product -- GDP less change in private inventories -- increased 1.1 percent in the fourth quarter, compared with an increase of 2.4 percent in the third. Gross domestic purchases Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever produced -- increased 0.1 percent in the fourth quarter, compared with an increase of 2.6 percent in the third. Disposition of personal income Current-dollar personal income increased $256.2 billion (7.9 percent) in the fourth quarter, compared with an increase of $72.7 billion (2.2 percent) in the third. The acceleration in personal income primarily reflected a sharp acceleration in personal dividend income, an upturn in personal interest income, and an acceleration in wage and salary disbursements. The sharp acceleration in personal dividend income reflected accelerated and special dividends that were paid by many companies in the fourth quarter in anticipation of changes in individual income tax rates. The upturn in personal interest income primarily reflected an upturn in interest rates for Treasury Inflation Protected Securities. The acceleration in wages and salaries reflected the pattern of monthly Bureau of Labor Statistics employment, hours, and earnings data for the fourth quarter, as well as a judgmental estimate of accelerated compensation in the form of bonus payments and other irregular pay in the fourth quarter. Personal current taxes increased $21.0 billion in the fourth quarter, compared with an increase of $10.0 billion in the third. Disposable personal income increased $235.2 billion (8.1 percent) in the fourth quarter, compared with an increase of $62.7 billion (2.1 percent) in the third. Real disposable personal income increased 6.8 percent, compared with an increase of 0.5 percent. Personal outlays increased $95.0 billion (3.3 percent) in the fourth quarter, compared with an increase of $88.6 billion (3.1 percent) in the third. Personal saving -- disposable personal income less personal outlays -- was $570.0 billion in the fourth quarter, compared with $429.8 billion in the third. The personal saving rate -- personal saving as a percentage of disposable personal income -- was 4.7 percent in the fourth quarter, compared with 3.6 percent in the third. For a comparison of personal saving in BEA’s national income and product accounts with personal saving in the Federal Reserve Board’s flow of funds accounts and data on changes in net worth, go to www.bea.gov/national/nipaweb/Nipa-Frb.asp. Current-dollar GDP Current-dollar GDP -- the market value of the nation's output of goods and services -- increased 0.5 percent, or $18.0 billion, in the fourth quarter to a level of $15,829.0 billion. In the third quarter, current-dollar GDP increased 5.9 percent, or $225.4 billion. 2012 GDP Real GDP increased 2.2 percent in 2012 (that is, from the 2011 annual level to the 2012 annual level), compared with an increase of 1.8 percent in 2011. The increase in real GDP in 2012 primarily reflected positive contributions from personal consumption expenditures (PCE), nonresidential fixed investment, exports, residential fixed investment, and private inventory investment that were partly offset by negative contributions from federal government spending and from state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased. The acceleration in real GDP in 2012 primarily reflected a deceleration in imports, upturns in residential fixed investment and in private inventory investment, and smaller decreases in state and local government spending and in federal government spending that were partly offset by decelerations in PCE, exports, and nonresidential fixed investment. The price index for gross domestic purchases increased 1.7 percent in 2012, compared with an increase of 2.5 percent in 2011. Current-dollar GDP increased 4.0 percent, or $600.3 billion, in 2012, compared with an increase of 4.0 percent, or $576.8 billion, in 2011. During 2012 (that is, measured from the fourth quarter of 2011 to the fourth quarter of 2012) real GDP increased 1.5 percent. Real GDP increased 2.0 percent during 2011. The price index for gross domestic purchases increased 1.5 percent during 2012, compared with an increase of 2.5 percent during 2011. ______________ BOX. Information on the assumptions used for unavailable source data is provided in a technical note that is posted with the news release on BEA's Web site. Within a few days after the release, a detailed "Key Source Data and Assumptions" file is posted on the Web site. In the middle of each month, an analysis of the current quarterly estimate of GDP and related series is made available on the Web site; click on Survey of Current Business, "GDP and the Economy." For information on revisions, see "Revisions to GDP, GDI, and Their Major Components." ______________ 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 the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements. * * * Next release -- February 28, 2013, at 8:30 A.M. EST for: Gross Domestic Product: Fourth Quarter and Annual 2012 (Second Estimate) Release Dates in 2013 2012: IV and 2012 annual 2013: I 2013: II 2013: III Gross Domestic Product Advance.......... January 30 April 26 July 31 October 30 Second........... February 28 May 30 August 29 November 26 Third............ March 28 June 26 September 26 December 20 Corporate Profits Preliminary...... ........ May 30 August 29 November 26 Revised.......... March 28 June 26 September 26 December 20 Comparisons of Revisions to GDP Quarterly estimates of GDP are released on the following schedule: the "advance" estimate, based on source data that are incomplete or subject to further revision by the source agency, is released near the end of the first month after the end of the quarter; as more detailed and more comprehensive data become available, the "second" and "third" estimates are released near the end of the second and third months, respectively. The "latest"” estimate reflects the results of both annual and comprehensive revisions. Annual revisions, which generally cover the quarters of the 3 most recent calendar years, are usually carried out each summer and incorporate newly available major annual source data. Comprehensive (or benchmark) revisions are carried out at about 5-year intervals and incorporate major periodic source data, as well as improvements in concepts and methods that update the accounts to portray more accurately the evolving U.S. economy. The table below shows comparisons of the revisions between quarterly percent changes of current-dollar and of real GDP for the different vintages of the estimates. From the advance estimate to the second estimate (one month later), the average revision to real GDP without regard to sign is 0.5 percentage point, while from the advance estimate to the third estimate (two months later), it is 0.6 percentage point. From the advance estimate to the latest estimate, the average revision without regard to sign is 1.3 percentage points. The average revision (with regard to sign) from the advance estimate to the latest estimate is 0.2 percentage point, which is larger than the average revisions from the advance estimate to the second or to the third estimates. The larger average revisions to the latest estimate reflect the fact that comprehensive revisions include major improvements, such as the incorporation of BEA’s latest benchmark input-output accounts. The quarterly estimates correctly indicate the direction of change of real GDP 97 percent of the time, correctly indicate whether GDP is accelerating or decelerating 72 percent of the time, and correctly indicate whether real GDP growth is above, near, or below trend growth more than four-fifths of the time. Revisions Between Quarterly Percent Changes of GDP: Vintage Comparisons [Annual rates] Vintages Average Average without Standard deviation of compared regard to sign revisions without regard to sign ____________________________________________________Current-dollar GDP_______________________________________________ Advance to second.................... 0.2 0.6 0.4 Advance to third..................... .1 .7 .4 Second to third...................... .0 .3 .2 Advance to latest.................... .3 1.2 1.0 ________________________________________________________Real GDP_____________________________________________________ Advance to second.................... 0.1 0.5 0.4 Advance to third..................... .1 .6 .5 Second to third...................... .0 .2 .2 Advance to latest.................... .2 1.3 1.0 NOTE. These comparisons are based on the period from 1983 through 2009.
Recovery Shows a Soft Spot
GDP Shrinks 0.1% on Government Cuts, but Consumer, Business Spending Offer Hope
By JOSH MITCHELL
“…The U.S. economy shrank for the first time in more than three years in the fourth quarter, underscoring the halting nature of the recovery. But the strength of consumer spending and business investment suggested that the economy will grow, albeit slowly, this year.
Gross domestic product—the broadest measure of goods and services churned out by the economy—fell at a 0.1% annual rate in the fourth quarter of 2012, according to the government’s initial estimate out Wednesday.
The details weren’t as discouraging as the headline. The drop, a surprise, was driven by a sharp fall in government spending and by businesses putting fewer goods on warehouse shelves, as well as by a decline in exports. The mainstays of the domestic private economy—housing, consumer spending and business investment in equipment and software—were stronger.
The U.S. joined other advanced economies in reporting contractions in the final months of last year. The U.K., Germany, Spain and Belgium have said their economies shrank in the fourth quarter, and several more euro-zone members in coming weeks are expected to report their own declines. Budget cuts appear to be a leading factor driving the contractions in many of those nations.
Deficit cutting in advanced economies is an important reason why global growth is expected to barely improve this year. The International Monetary Fund last week projected global growth of just 3.5% this year, a slight pickup from the estimated 3.2% growth in 2012, due partly to budget tightening in the U.S. and Europe. The International Monetary Fund expects advanced economies to expand just 1.4% this year, compared with 5.5% growth among developing economies.
Wednesday’s GDP report portrayed an economy stuck in low gear. For 2012, the economy grew 2.2%, up from the 1.8% growth of 2011, but still below the roughly 3% pace notched during healthier times.
For now, the economy is riding largely on the backs of consumers. Consumer spending, adjusted for inflation, increased at a 2.2% rate in the fourth quarter, up from 1.6% in the third. That included a jump in spending on durable goods, which are big-ticket items such as cars and refrigerators.
One thing that is helping consumers: They are starting to see substantial income gains after years of stagnation. The GDP report showed after-tax income rose at a rate of 6.8%, adjusted for inflation, the fastest pace since the recession.
One company benefiting from stronger consumer spending is Nando’s Peri-Peri USA, a closely held chain of chicken restaurants in the Washington, D.C., area. Same-store sales rose roughly 5% in the final months of 2012 compared with a year ago, said Chief Executive Burton Heiss.
Mr. Heiss said he believes consumers are feeling more secure as housing and other parts of the economy improve. Higher home prices, for example, might be giving consumers the confidence to spend more freely on going out. Mr. Heiss added that the strength seems to be continuing: Sales have picked up slightly since the start of the year.
U.S. companies stepped up investment in equipment and software during the quarter, with business investment rising at a rate of 8.4%, the strongest pace in a year. That defied expectations that companies would pull back due to worries over the “fiscal cliff” budget dispute in Washington.
Still, those factors weren’t strong enough to overcome declines in federal spending and exports and slower inventory growth.
The slower inventory investment was the biggest factor behind the contraction. Businesses essentially sold items from warehouse shelves, rather than placing new orders with manufacturers.
That may have been due to inventory accumulating too quickly last summer and some businesses becoming extra cautious about restocking. The upside is that with inventory levels now depleted, many businesses will be forced to replenish, possibly boosting growth in the current quarter.
Meanwhile, government spending, which has been a drag on growth for more than two years, declined for the ninth time in 10 quarters. The biggest cuts came in military spending, which tumbled at a rate of 22.2%, the largest drop since 1972. But state and local spending also fell, dashing hopes of stabilization after a rare increase in the third quarter.
Military analysts said the decline likely was a result of pressure on the Pentagon from a number of areas.
Among them: reductions in spending on the war in Afghanistan as it winds down, a downturn in planned military spending, a constraint placed on the Pentagon budget because the federal government is operating on short-term resolutions that limit spending growth, as well as concern that further cuts may be in the pipeline.
Pentagon officials already have imposed tighter controls on military spending to deal with the challenges.
David Berteau, a former Defense Department official who now heads the International Security Program at the Center for Strategic and International Studies in Washington, said he was surprised by the sharp drop and predicted that persistent uncertainty about the defense budget would continue to be a drag on the national economy.
“Is this a blip in the data or is it a trend?” he said. “I think you’re seeing a trend.”
The effect of defense cuts on the economy in the fourth quarter likely raises the stakes of looming budget fights between the White House and congressional Republicans. The White House said the GDP report showed the need for Congress to avoid “self-inflicted wounds” and reach a deal.
Companies tied to the defense industry already are bracing for cuts.
Noel McCormick, president of McCormick Stevenson, a small engineering firm in Clearwater, Fla., that designs weapons for major defense contractors, said big clients have told him they may resort to layoffs and cut spending if cuts happen.
That would have a “tremendous” impact on McCormick’s 12-person company, he said, likely causing it to cut back as well.
“There is a great deal of angst associated in the coming months,” Mr. McCormick said.
—Sudeep Reddy, Jon Hilsenrath, Ben Casselman and Dion Nissenbaum contributed to this article.