Advance Estimate of Real GDP Growth in Second Quarter of 2013 is 1.7% With First Quarter of 2013 Revised Down to 1.1% (Original Advance Estimate was 2.5%!)! — U.S. Economy Is Stagnating as Growth Continues To Decline — Videos

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National Income and Product Accounts
Gross Domestic Product, second quarter 2013 (advance estimate);
Comprehensive Revision: 1929 through 1st quarter 2013
      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 1.7 percent in the second quarter of 2013
(that is, from the first quarter to the second quarter), according to the "advance" estimate released by the
Bureau of Economic Analysis.  In the first quarter, real GDP increased 1.1 percent (revised).

      The Bureau emphasized that the second-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 3
and "Comparisons of Revisions to GDP" on page 18).  The "second" estimate for the second quarter,
based on more complete data, will be released on August 29, 2013.

      The increase in real GDP in the second quarter primarily reflected positive contributions from
personal consumption expenditures (PCE), exports, nonresidential fixed investment, private inventory
investment, and residential investment that were partly offset by a negative contribution from federal
government spending. Imports, which are a subtraction in the calculation of GDP, increased.

      The acceleration in real GDP in the second quarter primarily reflected upturns in nonresidential
fixed investment and in exports, a smaller decrease in federal government spending, and an upturn in
state and local government spending that were partly offset by an acceleration in imports and
decelerations in private inventory investment and in PCE.

BOX._______

     Comprehensive Revision of the National Income and Product Accounts

     The estimates released today reflect the results of the 14th comprehensive (or benchmark) revision
of the national income and product accounts (NIPAs) in conjunction with the second quarter 2013
"advance" estimate.  More information on the revision is available on BEA’s Web site at
www.bea.gov/gdp-revisions.

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 (2009) dollars.  Price
indexes are chain-type measures.

This news release is available on BEA’s Web site  along with the Technical Note
and Highlights related to this release.
_______________

     The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 0.3 percent in the second quarter, compared with an increase of 1.2 percent in the first.
Excluding food and energy prices, the price index for gross domestic purchases increased 0.8 percent in
the second quarter compared with 1.4 percent in the first.

      Real personal consumption expenditures increased 1.8 percent in the second quarter, compared
with an increase of 2.3 percent in the first.  Durable goods increased 6.5 percent, compared with an
increase of 5.8 percent.  Nondurable goods increased 2.0 percent, compared with an increase of 2.7
percent.  Services increased 0.9 percent, compared with an increase of 1.5 percent.

      Real nonresidential fixed investment increased 4.6 percent in the second quarter, in contrast to a
decrease of 4.6 percent in the first.  Nonresidential structures increased 6.8 percent, in contrast to a
decrease of 25.7 percent.  Equipment increased 4.1 percent, compared with an increase of 1.6 percent.
Intellectual property products increased 3.8 percent, compared with an increase of 3.7 percent.  Real
residential fixed investment increased 13.4 percent, compared with an increase of 12.5 percent.

      Real exports of goods and services increased 5.4 percent in the second quarter, in contrast to a
decrease of 1.3 percent in the first.  Real imports of goods and services increased 9.5 percent, compared
with an increase of 0.6 percent.

      Real federal government consumption expenditures and gross investment decreased 1.5 percent
in the second quarter, compared with a decrease of 8.4 percent in the first.  National defense decreased
0.5 percent, compared with a decrease of 11.2 percent.  Nondefense decreased 3.2 percent, compared
with a decrease of 3.6 percent.  Real state and local government consumption expenditures and gross
investment increased 0.3 percent, in contrast to a decrease of 1.3 percent.

      The change in real private inventories added 0.41 percentage point to the second-quarter change
in real GDP after adding 0.93 percentage point to the first-quarter change.  Private businesses increased
inventories $56.7 billion in the second quarter, following increases of $42.2 billion in the first quarter
and $7.3 billion in the fourth.

      Real final sales of domestic product -- GDP less change in private inventories -- increased 1.3
percent in the second quarter, compared with an increase of 0.2 percent in the first.

Gross domestic purchases

      Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever
produced -- increased 2.4 percent in the second quarter, compared with an increase of 1.4 percent in the
first.

Disposition of personal income

      Current-dollar personal income increased $140.1 billion (4.1 percent) in the second quarter, in
contrast to a decrease of $157.1 billion (4.4 percent) in the first.  The upturn in personal income
primarily reflected sharp upturns in personal dividend income and in wages and salaries and a sharp
deceleration in contributions for government social insurance (a subtraction in the calculation of
personal income).

*	Personal dividend income increased in the second quarter, in contrast to a large decrease in the
        first. The first-quarter decline in dividend income primarily reflected the accelerated and special
        dividends that were paid by many companies in the fourth quarter of 2012.

*	Wages and salaries increased in the second quarter, in contrast to a decrease in the first. The
        first-quarter decline in wages and salaries is based on preliminary quarterly census of
        employment and wages data from the Bureau of Labor Statistics.

*	The sharp deceleration in contributions for government social insurance primarily reflected the
        first-quarter expiration of the "payroll tax holiday" that increased the social security contribution
        rate for employees and self-employed workers by 2.0 percentage points.

      Personal current taxes increased $36.0 billion in the second quarter, compared with an increase
of $74.3 billion in the first.

      Disposable personal income increased $104.1 billion (3.4 percent) in the second quarter, in
contrast to a decrease of $231.5 billion (7.2 percent) in the first.  Real disposable personal income
increased 3.4 percent, in contrast to a decrease of 8.2 percent.

      Personal outlays increased $44.7 billion (1.5 percent) in the second quarter, compared with an
increase of $98.7 billion (3.4 percent) in the first.  Personal saving -- disposable personal income less
personal outlays -- was $553.4 billion in the second quarter, compared with $494.0 billion in the first.

      The personal saving rate -- personal saving as a percentage of disposable personal income -- was
4.5 percent in the second quarter, compared with 4.0 percent in the first.  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
2.4 percent, or $98.1 billion, in the second quarter to a level of $16,633.4 billion.  In the first quarter,
current-dollar GDP increased 2.8 percent, or $115.0 billion.

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."

____________

                          COMPREHENSIVE REVISION OF THE NATIONAL INCOME AND PRODUCT
                                ACCOUNTS: 1929 THROUGH FIRST QUARTER 2013

      Today, BEA released revised statistics of gross domestic product (GDP) and of other national
income and product accounts (NIPAs) series from 1929 through the first quarter of 2013.
Comprehensive revisions, which are carried out about every 5 years, are an important part of BEA’s
regular process for improving and modernizing its accounts to keep pace with the ever-changing U.S.
economy.

      Most of the tables in this release present revised statistics for 2002 through the first quarter of
2013.  Selected NIPA tables, with statistics from 1929 forward, are available on BEA's Web site
(www.bea.gov).  Most of the remaining NIPA tables will be released later in August.  An article
describing the statistics will be published in the September 2013 issue of BEA’s monthly journal, the
Survey of Current Business.

Summary of revisions

      The picture of the economy shown in the revised estimates is very similar in broad outline to the
picture shown in the previously published estimates.  The similarity and some of the differences can be
seen in the following:

*	For 1929–2012, the average annual growth rate of real GDP was 3.3 percent, 0.1 percentage
        point higher than in the previously published estimates.  For the more recent period, 2002–2012,
        the growth rate was 1.8 percent, 0.2 percentage point higher than in the previously published
        estimates.

*	For 2002–2012, the average rate of change in the prices paid by U.S. residents was 2.3 percent,
        0.1 percentage point lower than in the previously published estimates.

*	For 2009–2012, the average annual growth rate of real GDP was 2.4 percent, 0.3 percentage
        point higher than in the previously published estimates.  The percent change in real GDP was
        revised up 0.1 percentage point for 2010, was unrevised for 2011, and was revised up 0.6
        percentage point for 2012.

*	For the period of contraction from the fourth quarter of 2007 to the second quarter of 2009, real
        GDP decreased at an average annual rate of 2.9 percent; in the previously published estimates, it
        decreased 3.2 percent.

*	For the period of expansion from the second quarter of 2009 to the first quarter of 2013, real
        GDP increased at an average annual rate of 2.2 percent; in the previously published estimates, it
        increased 2.1 percent.

Improvements incorporated in this comprehensive revision

      Comprehensive revisions encompass three major types of improvements:

*	Changes in definitions and in classifications that update the accounts to more accurately portray
        the evolving U.S. economy,

*	Changes in presentations that make the NIPA tables more informative, and

*	Statistical changes that introduce new and improved methodologies and that bring in newly
        available and revised source data (see box on page 8).

      The improvements incorporated in the revised estimates have been previewed in a series of
articles in the Survey and are available on BEA’s Web site at www.bea.gov/gdp-revisions.

      Changes in definitions, classifications, and presentations.  The changes in definitions, in
classifications, and in presentations introduced in this comprehensive revision include the following:

*	Expenditures by business, government, and nonprofit institutions serving households (NPISH)
        for research and development (R&D) are recognized as fixed investment.  The new treatment
        improves BEA’s measures of fixed investment and allows users to better measure the effects of
        innovation and intangible assets on the economy.

*	Similarly, expenditures by private enterprises for the creation of entertainment, literary, and
        artistic originals are recognized as fixed investment, further expanding BEA’s measures of
        intangible assets.

*	In the NIPA fixed investment tables, a new category of investment, "intellectual property
        products," consists of research and development; entertainment, literary, and artistic originals;
        and software.

*	Transactions of defined benefit pension plans are recorded on an accrual accounting basis, which
        recognizes the costs of unfunded liabilities.

*	An expanded set of ownership transfer costs for residential fixed assets is recognized as fixed
        investment, and the accuracy of the associated asset values and services lives is improved.

*	The reference year for the chain-type quantity and price indexes and for the chained-dollar
        estimates is updated to 2009 from 2005.

      Statistical changes.  Important statistical changes that introduce new and improved
methodologies and that bring in newly available source data include the following:

*	BEA’s 2007 benchmark input-output (I-O) accounts, which provide the most thorough and
        detailed information on the structure of the U.S. economy, are used to benchmark the
        expenditure components of GDP and some of the income components.

*	Beginning with 1966, the estimates of employers’ contributions to state and local government-
        sponsored defined contribution pension plans are improved by incorporating new source data.

*	Beginning with 1985, the methods for computing financial services provided by commercial
        banks are improved to establish a more accurate picture of banking output.

*	Beginning with 1993, the estimates of proprietors’ income are improved by more accurately
        accounting for the capital gains and losses attributable to corporate partners.

*	Beginning with 1993, the estimates of mortgage interest paid for nonfarm permanent-site
        housing are improved by incorporating several new data sources.

A table that summarizes the major sources of revision for selected NIPA components is available on
BEA’s Web site at www.bea.gov/gdp-revisions.

      Effects of improvements on major aggregates.  The improvements and the new and revised
source data incorporated with this comprehensive revision have notable effects on current-dollar NIPA
aggregates without changing broad economic trends or the general patterns of business cycles.  In the
aggregate, changes in definitions (mainly the recognition of new forms of fixed investment) have the
largest effect on current-dollar GDP and GDI for 1929–2012, and statistical changes (improved data and
methodologies) tend to have smaller effects.  For example, for 2012, the level of current-dollar GDP was
revised up $559.8 billion; $526.0 billion of this upward revision resulted from definitional changes.
Sources of Revision to Current-Dollar GDP
      Changes in definitions (mainly accrual accounting for defined benefit pension plans, which
credits households with the value of accrued benefits from these plans) raise personal income and
personal saving; statistical changes have mixed effects on personal income and on personal saving.
Sources of Revision to Current-Dollar Personal Income
      News release tables.  This release includes the tables that will be regularly shown in future GDP
news releases; in addition, special tables have been included to highlight the effects of the
comprehensive revision.  The special tables are:

*	Tables 1A, 2A, and 4A compare revised and previously published estimates for percent changes
        in real GDP, for contributions to percent change in real GDP, and for percent changes in chain-
        type price indexes for GDP and related measures, respectively;

*	Tables 7A, 7B, and 7C show annual levels, percent changes, and revisions to percent changes for
        current-dollar GDP, for real (chained-dollar) GDP, and for chain-type price indexes for GDP,
        respectively;

*	Table 12C shows revisions to corporate profits by industry.

      Most of the tables show annual estimates beginning with 2002; quarterly estimates (if shown)
begin with the first quarter of 2007.  Three of the regular tables -- tables 3, 11, and 12 -- are split into A
and B segments in this release to accommodate this longer-than-usual time span.

      With this release, selected NIPA tables are available on BEA’s Web site.  Most of the remaining
NIPA tables will be available later in August.

Box.________

                                         New and revised data

      The revised estimates reflect the incorporation of newly available and revised source data.  The
most important source data that affect the estimates are BEA’s benchmark 2007 input-output (I-O)
accounts.  The revised estimates also incorporate data on inventories, on receipts and expenses of
business establishments and of governments, on sales by detailed commodity and by product line, on
final industry and product shipments from the 2007 Economic Census, and on trade margins from both
the 2007 Economic Census and the 2007 annual surveys of merchant wholesale and of retail trade.  In
addition, the revised estimates incorporate monthly and annual Census Bureau industry data on
manufacturing, on wholesale trade, and on retail trade for 2003 forward.  The revised estimates also
reflect data on housing from the 2010 decennial Census of Population and Housing.  Estimates that are
based on BEA’s international transactions accounts (ITAs) -- primarily net exports of goods and services
and rest-of-the-world income receipts and payments -- were revised to reflect improvements to the ITAs
that were introduced since 2009.  Estimates of underreported income were revised using Internal
Revenue Service (IRS) National Research Program data for 2006.  Other data that were incorporated
include revised data on the expenditures and receipts of state and local governments for fiscal years
2006–2009 from the Census Bureau.

      The revised estimates for 2010–2012 also reflect the incorporation of newly available and
revised source data that became available since the last annual NIPA revision in July 2012.  The most
important of these data sources are Census Bureau annual surveys of state and local governments for
fiscal year 2010 (revised) and fiscal year 2011 (preliminary), of manufactures for 2010 (revised) and
2011 (preliminary), of merchant wholesale trade and of retail trade for 2010 (revised) and 2011
(preliminary), and of services and of the value of construction spending for 2010 and 2011 (revised) and
2012 (preliminary); federal government budget data for fiscal years 2012 and 2013 (revised); Bureau of
Labor Statistics (BLS) quarterly census of employment and wages (QCEW) for 2010–2012 (revised);
IRS tabulations of corporate tax returns for 2010 (revised) and 2011 (preliminary) and of sole
proprietorship and partnership tax returns for 2011; and U.S. Department of Agriculture (USDA) farm
statistics for 2010–2012 (revised).

      Data from BEA’s annual revision of the ITAs were incorporated for 2010–2012 for most
components at their "best level;" revisions for earlier years, along with data from the June 2014 revision
of the ITAs, will be incorporated in the NIPAs in the 2014 annual revision.
_______________
FOOTNOTE.______
The 2007 benchmark input-output accounts are scheduled for release in December 2013. At that time, BEA will
also release the comprehensive revision of the annual industry accounts, which will be consistent with this
comprehensive revision of the NIPAs.
_______________

The revisions

      For this comprehensive revision, many current-dollar estimates were revised back to 1929, the
earliest year for which NIPA estimates are available, as a result of changes in definitions, in
classifications, and in presentations.

      Real GDP growth.  For 1929–2012, the average annual growth rate of real GDP was 3.3
percent, 0.1 percentage point higher than in the previously published estimates.  For the more recent
period, 2002–2012, the average annual growth rate was 1.8 percent, 0.2 percentage point higher than in
the previously published estimates.  For the most recent years, 2009–2012, the average annual growth
rate of real GDP was 2.4 percent, 0.3 percentage point higher than in the previously published estimates.
For the 3 most recent years, the annual growth rate:

*	was revised up from 2.4 percent to 2.5 percent for 2010,
*	was unrevised at 1.8 percent for 2011, and
*	was revised up from 2.2 percent to 2.8 percent for 2012.

      Real GDI growth.  For 1929–2012, the average annual growth rate of real GDI was 3.3 percent,
0.1 percentage point higher than in the previously published estimates.  For the more recent period,
2002–2012, the average annual growth rate was 1.8 percent, 0.2 percentage point higher than in the
previously published estimates.  For the most recent years, 2009–2012, the average annual growth rate
of real GDI was 2.6 percent, 0.3 percentage point higher than in the previously published estimates.  For
the 3 most recent years, the annual growth rate:

*	was revised down from 3.1 percent to 2.7 percent for 2010,
*	was revised up from 1.8 percent to 2.5 percent for 2011, and
*	was revised up from 2.2 percent to 2.5 percent for 2012.

      Business cycles.  For the contraction that lasted from the fourth quarter of 2007 to the second
quarter of 2009, real GDP decreased at a 2.9 percent annual rate; in the previously published estimates,
it decreased 3.2 percent.  The cumulative decrease in real GDP (not at an annual rate) was 4.3 percent; in
the previously published estimates, the cumulative decrease was 4.7 percent.  In the revised estimates,
real GDP decreased in the first, third, and fourth quarters of 2008 and in the first and second quarters of
2009.

      For the expansion from the second quarter of 2009 to the first quarter of 2013, real GDP
increased at a 2.2 percent annual rate; in the previously published estimates, it increased 2.1 percent.
From the third quarter of 2009 to the first quarter of 2013, real GDP increased in all quarters except for
the first quarter of 2011, when real GDP decreased 1.3 percent; in the previously published estimates,
real GDP increased in all quarters during this period.  Earlier business cycles show little revision.

      Price changes.  The revisions to major price indexes are small.  For 1929–2012, the average
annual increase in the price index for gross domestic purchases was revised down from 3.0 percent to
2.9 percent; the average annual increase in the price index for GDP was unrevised at 2.9 percent.  For
2002–2012, the average annual increase in the price index for gross domestic purchases was revised
down from 2.4 percent to 2.3 percent; the average annual increase in the price index for GDP was
revised down from 2.3 percent to 2.1 percent.  For 2009–2012, the average annual increase in the price
index for gross domestic purchases was revised down from 1.9 percent to 1.8 percent; the average
annual increase in the price index for GDP was revised down from 1.8 percent to 1.6 percent.

      For 1929–2012, the average annual increase in the price index for personal consumption
expenditures (PCE) was unrevised at 2.9 percent.  For 2002–2012, the average annual increase in the
PCE price index was revised down from 2.2 percent to 2.1 percent.  For 2009–2012, the average annual
increase in the PCE price index was unrevised at 2.0 percent.

      Real disposable personal income (DPI) growth.  For 1929–2012, the average annual increase
in real DPI was 3.2 percent, 0.1 percentage point higher than in the previously published estimates.  For
2002–2012, the average annual increase was 2.0 percent, 0.2 percentage point higher than in the
previously published estimates.  For 2009–2012, the average annual increase was 1.8 percent, 0.2
percentage point higher than in the previously published estimates.

      Personal saving.  Personal saving (DPI less personal outlays) was revised up for 1929–2007,
down for 2008, and up for 2009–2012.  These revisions reflect the revisions to DPI and are mainly the
result of adopting the accrual treatment of defined benefit pension plans.  The personal saving rate
(personal saving as a percentage of DPI) was revised up for 1929–2007, down for 2008, and up for
2009–2012, reflecting the revisions to personal saving.

Revisions to current-dollar estimates

      The revisions to current-dollar GDP, to personal income and its disposition, and to national
income are shown in table 1B.  This table shows the "revisions in level," that is, the revised estimates
less the previously published estimates; table 1B also shows the revisions as a percent of the previously
published estimates for selected years.  The revised levels of annual GDP and its major components for
1965–2012, along with percent changes from the preceding year and revisions to the percent changes,
are shown in table 7A.

      GDP.  Current-dollar GDP was revised up for all years (1929–2012).  The upward revisions to
current-dollar GDP mainly reflect the recognition of additional expenditures -- for R&D; for the creation
of entertainment, literary, and artistic originals; and for an expanded set of ownership transfer costs -- as
fixed investment (see "Revision Analysis for GDP, 2012").  The new accrual treatment for government-
sponsored defined benefit pension plans results in revisions to current-dollar GDP through revisions to
supplements to wages and salaries for government employees (specifically, employer contributions for
employee pension and insurance funds); these revisions are upward for 1929–1978, downward for
1979–1991, and upward for 1992–2012.

Box._______

                                             Revision Analysis for GDP, 2012
                                              (Billions of current dollars)

Total Revision                                                                             559.8

Due to major definitional changes                                                          526.0

Capitalization of research and development                                                 396.7
Capitalization of entertainment, literary, and artistic originals                           74.3
Expanded set of ownership transfer costs for residential fixed assets                       42.3
Accrual accounting for defined benefit pension programs                                     12.6

Due to statistical changes                                                                  33.8

___________

      PCE.  Revisions to PCE are generally small before 1985; PCE was revised up for 1985 and
1986, down for 1987–2011, and up for 2012.  PCE for services accounts for most of the revisions for all
years except for 2011.

      Services.  PCE for services was revised up for 1985 and 1986, down for 1987–2010, and up for
2011 and 2012.  For most years beginning with 1985, the improved method for estimating services of
commercial banks results in downward revisions to PCE for financial services.  For 1965–2012 (and for
several prior years), the gross output of NPISH was revised down; the removal of R&D expenses of
NPISH (and their reclassification as fixed investment) more than offsets the addition to expenses of
consumption of fixed capital (CFC) for R&D capital.  The revisions also reflect the incorporation of the
2007 benchmark I-O accounts, of new and revised annual Census Bureau surveys of services, and of
other new and revised source data.

      Goods.  Revisions to PCE for goods begin with 1998 and follow a mixed pattern, with
downward revisions for 2010–2012.  The revisions to PCE for goods reflect the incorporation of the
2007 benchmark I-O accounts, of new and revised data from the Census Bureau’s retail trade surveys,
and of other new and revised source data.

      Private fixed investment.  Current-dollar private fixed investment was revised up for 1929–
2012.  The upward revisions reflect the recognition of additional expenditures -- for R&D; for the
creation of entertainment, literary, and artistic originals; and for an expanded set of ownership transfer
costs -- as fixed investment.

      Nonresidential structures.  The downward revisions for 2003–2012 primarily reflect the
incorporation of data from the 2007 benchmark I-O accounts, of revised footage drilled and expenditure
data from the Census Bureau and trade sources, and of revised Census Bureau construction spending
data.

      Equipment.   Software is now classified as part of intellectual property products rather than as
part of private equipment and software.  Private equipment (without software) was revised up for 2003–
2012, reflecting the incorporation of BEA’s 2007 benchmark I-O accounts, of new and revised Census
Bureau surveys of manufactures, and of other new and revised source data.

      Residential fixed investment.  The upward revisions to residential fixed investment for 1929–
2012 mainly reflect the recognition of an expanded set of ownership transfer costs for residential fixed
assets as fixed investment.  The revisions also reflect the incorporation of data from the 2007 benchmark
I-O accounts and of new and revised data from the Census Bureau surveys of construction spending.

      Intellectual property products.  Beginning with this comprehensive revision, the NIPA tables
include a new category of fixed investment, "intellectual property products."  The recognition of
expenditures for R&D and for the creation of entertainment, literary, and artistic originals as fixed
investment results in upward revisions to gross private domestic investment.  The downward revisions to
software investment for 2010–2012 (and small revisions for 2003–2009) reflect the incorporation of the
2007 benchmark I-O accounts and of new and revised annual Census Bureau surveys of services.
      Change in private inventories.  The revisions begin with 2002 and are mostly upward; the
revisions are dominated by revisions to nonfarm inventories for 2002–2010 and by farm inventories for
2011 and 2012.  The revisions to nonfarm inventories reflect data from a variety of sources, including
newly available and revised Census Bureau data on inventory book values, and the incorporation of new
commodity price weights from the 2007 benchmark I-O accounts.  The revisions to farm inventories
reflect revised USDA farm statistics for 2010–2012.

      Exports and imports of goods and services.  Revisions to net exports of goods and services are
generally small before 2002; the revisions are upward for 2002–2007, downward for 2008–2011, and
upward for 2012.  The revisions to net exports are mostly due to revisions to exports for 2002–2009 and
for 2012 and are mostly due to revisions to imports for 2010 and 2011.  Exports were revised up for
2002–2007, down for 2008–2010, and up for 2011and 2012.  The revisions to imports are upward for
2010 and 2011 and are small for other years.  The estimates reflect the incorporation of revised data
from BEA’s ITAs for 1999–2012.

      Government consumption expenditures and gross investment.  Government consumption
expenditures and gross investment was revised up for 1929–2012.  The revisions mainly reflect the
recognition of expenditures for R&D as fixed investment and the addition to consumption expenditures
of the CFC for R&D assets.

      Federal government.  The upward revisions to federal government consumption expenditures
and gross investment for 1929–2012 mainly reflect the recognition of expenditures for R&D as fixed
investment.  The new accrual treatment for defined benefit pension plans results in upward revisions to
contributions for employee pension and insurance funds for 1929–1979 and downward revisions for
1980–2012.  The revisions also reflect improved source data and methods, including revised federal
budget data for 2012 and 2013.

      State and local government.  State and local government consumption expenditures and gross
investment was revised up for 1929–1975, down for 1976–1988, and up for 1989–2012.  These revisions
mainly reflect the new accrual approach for measuring state and local government-sponsored defined
benefit pension plans, which results in revisions to state and local government contributions for
employee pension and insurance funds that are upward for 1929–1978, downward for 1979–1986, and
upward for 1987–2012.  Revisions also result from statistical changes, including the incorporation of
improved source data on expenditures for defined contribution pension plans and the improved method
for estimating services of commercial banks.  The revisions also reflect the incorporation of the 2007
benchmark I-O accounts, of new and revised government finances data from the Census Bureau, and of
other new and revised source data.

      Personal income.   Personal income was revised up for 1929–2007, down for 2008, and up for
2009–2012.  These revisions mainly reflect the accrual approach for measuring defined benefit pension
plans, which results in upward revisions to personal income receipts on assets for 1929–2012 and in
upward revisions to supplements (specifically, employer contributions for employee pension and
insurance funds) for 1929–1975, for 1989–2002, and for 2004–2011.  A number of other definitional
and statistical changes affected the revisions to personal income.  The revisions to the components of
personal income are discussed below.
Revisions to Personal Income
      Wages and salaries.  The revisions mainly reflect revisions to private wages and salaries.  The
revisions are generally small and mixed for years prior to 2002, are downward for 2002–2011, and are
upward for 2012.  The revisions reflect revised estimates of misreporting and new and revised BLS
QCEW data.

      Supplements to wages and salaries.  The revisions to supplements reflect the revisions to
employer contributions for pension and insurance funds that result from the accrual approach for
measuring defined benefit pension plans.  Employer contributions for state and local government
defined benefit plans was revised up for 1929–1978, down for 1979–1986, and up for 1987–2012.
Employer contributions for federal government defined benefit plans was revised up for 1929–1979 and
down for 1980–2012.  Employer contributions for private defined benefit plans was revised down for
1968–1985, up for 1986–2001, down for 2002–2006, up for 2007, and down for 2008–2012.
Contributions for state and local government defined contribution pension plans was revised up for
1967–2012, reflecting the incorporation of improved source data.

      Proprietors’ income.  Proprietors’ income was revised down for 1965–2011 and up for 2012;
the revisions for years before 1965 are small.  Nonfarm proprietors’ income was revised down for 1965–
2011 and up for 2012.  The revisions to proprietors’ income primarily reflect revisions to nonfarm
proprietors’ income for most years (except for 2009 and for 2012).  Farm proprietors’ income had
relatively large upward revisions for 2011 and 2012, reflecting the incorporation of revised USDA data
for 2010–2012.

      The revisions to nonfarm proprietors’ income reflect a number of definitional and statistical
changes as well as revised source data.  Revisions due to the improved accounting for the capital gains
and losses attributable to corporate partners are downward for 2002–2008, upward for 2009, and
downward for 2010–2012.  Revisions due to the capitalization of expenditures for the creation of
entertainment, literary, and artistic originals and for an expanded set of ownership transfer costs are
downward, while the revisions due to the capitalization of R&D expenditures are upward.  The revisions
also reflect new IRS estimates for underreporting of income as well as new IRS tabulations of tax return
data for sole proprietorships and partnerships for 2011.

      Rental income of persons.  Rental income of persons was revised down for 1929–2002 and was
revised up for 2003 forward.  The improved methodology for estimating mortgage interest paid for
nonfarm permanent site housing results in downward revisions to rental income of persons for 1993–
2001 and upward revisions for 2002–2012.  The recognition of an expanded set of ownership transfer
costs for residential assets as fixed investment results in downward revisions for all years, partly
offsetting the upward revisions to rental income of persons for 2003–2012.  The revisions also reflect
revisions to owner- and tenant-occupied space rent, based on data from the 2010 Census of Housing and
the incorporation of other new and revised source data.

      Personal interest income.  Personal interest income was revised up for all years except for
2008.  The upward revisions mainly reflect the new accrual treatment of defined benefit pension plans.
Personal interest income was also affected by several other changes in methodology, including an
improved method for distributing the investment income of regulated investment companies by type of
income and the improved method for measuring interest associated with financial services of
commercial banks.  Revisions to personal interest income also reflect the incorporation of new and
revised source data from the Federal Reserve Board and other sources.

      Personal dividend income.  Personal dividend income was revised up for most years for 1991–
2009, was revised down for 2010, was revised up for 2011, and was revised down for 2012.  The
revisions to personal dividend income reflect the improved method for distributing the investment
income of regulated investment companies by type of income as well as the incorporation of new and
revised IRS tabulations of corporate tax returns and of data from BEA’s ITAs on dividends from the rest
of the world.

      Personal current transfer receipts.  Personal current transfer receipts was revised down for
2002, up for 2003–2009, and down for 2010–2012.  The revisions reflect the incorporation of new and
revised source data.

      Contributions for government social insurance.  The revisions to contributions for
government social insurance (which is deducted in the calculation of personal income) are small for
2002–2012.

      Personal current taxes.  Personal current taxes was revised up for 2011 and 2012; revisions are
generally small for prior years.  The revisions reflect the incorporation of new tax collections data from
the Treasury Department and the Social Security Administration and of new and revised Census Bureau
state and local government finances data.

      Disposable personal income.  The pattern of revisions to disposable personal income, which is
equal to personal income less personal current taxes, is similar to that of personal income.

      Personal outlays.  This series consists of PCE, personal interest payments, and personal current
transfer payments.  The revisions to personal outlays primarily reflect the revisions to PCE that were
previously described.  Personal interest payments was revised up for 1985 forward; revisions for prior
years are small.  The revisions to personal interest payments result from the improved method for
measuring the financial services of commercial banks and associated interest income from the
incorporation of new and revised source data.  Personal current transfer payments was revised down for
2007–2012.

      GDI.  Current-dollar GDI, like current-dollar GDP, was revised up for all years for 1929–2012.
The upward revisions to current-dollar GDI and GDP mainly reflect the recognition of additional
expenditures -- for R&D; for the creation of entertainment, literary, and artistic originals; and for an
expanded set of ownership transfer costs -- as fixed investment.

      National income.  National income was revised up for 1929–1978, down for 1979–2001, up for
2002–2004, down for 2005–2010, and up for 2011 and 2012.  The revisions to national income reflect
the revisions to the components of national income that were previously described; the revisions to the
remaining components of national income are discussed below.
Revision to National Income
      Corporate profits with inventory valuation and capital consumption adjustments.
Corporate profits was revised up for 1929–1986, down for 1987–2001, and up for 2002–2012.
Revisions to corporate profits due to the capitalization of expenditures for R&D and for the creation of
entertainment, literary, and artistic originals are upward for 1929–2012.  Revisions to corporate profits
due to the new accrual treatment of defined benefit pension plans are upward for 1968–1985, downward
for 1986–2002, upward for 2003–2006, downward for 2007–2009, and upward for 2010–2012.  The
improved method for distributing the investment income of regulated investment companies by type of
income results in revisions that are downward for 1992–2001, upward for 2002, and downward for
2003–2012.  The revisions to corporate profits also reflect the incorporation of new and revised IRS
tabulations of corporate tax return data and of new and revised data from BEA’s ITAs and from other
sources.

      Net interest and miscellaneous payments.  Net interest and miscellaneous payments was
revised up for most years for 1965–2001 and down for 2002–2012.  Revisions for years prior to 1965
are small.  The revisions reflect the incorporation of several definitional and statistical improvements,
including the new accrual treatment of defined benefit pension plans, the improved method for
distributing the investment income of regulated investment companies by type of income, the improved
methodology for estimating mortgage interest paid for nonfarm permanent site housing, and the
improved method for measuring the financial services of commercial banks, and the incorporation of
new and revised data from a number of sources.

      Consumption of fixed capital (CFC).  CFC was revised up substantially for 1929–2012.  The
upward revisions to CFC reflect the addition of CFC for R&D; for the creation of entertainment, literary,
and artistic originals; and for an expanded set of ownership transfer costs of residential assets.  In
addition, CFC was revised up to reflect a faster depreciation rate of brokers’ commissions on residential
structures.  The revisions to CFC also reflect statistical improvements and revisions to BEA’s estimates
of fixed investment and prices.

      Statistical discrepancy.  The statistical discrepancy, which is the difference between GDP and
GDI, was revised for 1929–2012.  The directions of the revisions are mixed for 1929–2000; the
statistical discrepancy was revised down for 2001–2003, was revised up for 2004–2008, was revised
down for 2009, was revised up for 2010, and was revised down for 2011 and 2012.  (In theory, GDP
should equal GDI; in practice, they differ because their components are estimated using largely
independent and less-than-perfect source data.)

Box._______
                    Availability of Revised Estimates and Related Information

Revised estimates for selected NIPA tables are on BEA's Web site:
www.bea.gov

The comprehensive revision was previewed in a series of articles in the Survey of Current Business;
the articles are also available on BEA's Web site:
www.bea.gov/gdp-revisions

The release schedule for revised NIPA tables is available at
www.bea.gov/national/table_schedule_20130606.htm
___________

      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 -- August 29, 2013, at 8:30 A.M. EDT for:
                          Gross Domestic Product:  Second Quarter 2013 (Second Estimate)
                            Corporate Profits:  Second Quarter (Preliminary Estimate)

                                            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.
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The U.S. Economy Real Gross Domestic Product (GDP) Grew Only 1.8% (Third Estimate) Not 2.4% (Second Estimate) in First Quarter of 2013 — Videos

Posted on June 28, 2013. Filed under: American History, Blogroll, College, Communications, Constitution, Economics, Education, Employment, Federal Government, Federal Government Budget, Fiscal Policy, government spending, history, Law, liberty, Life, Links, media, People, Philosophy, Politics, Raves, Resources, Security, Video, Wealth, Wisdom | Tags: , , , , , , , , , , , , |

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GDP

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http://seekingalpha.com/article/1379861-real-gdp-per-capita-another-perspective-on-the-economy

Line 2011 2012 2013
I II III IV I II III IV I
1 Gross domestic product 0.1 2.5 1.3 4.1 2.0 1.3 3.1 0.4 1.8
2 Personal consumption expenditures 3.1 1.0 1.7 2.0 2.4 1.5 1.6 1.8 2.6
3 Goods 5.4 -1.0 1.4 5.4 4.7 0.3 3.6 4.3 4.4
4 Durable goods 7.3 -2.3 5.4 13.9 11.5 -0.2 8.9 13.6 7.6
5 Nondurable goods 4.6 -0.3 -0.4 1.8 1.6 0.6 1.2 0.1 2.8
6 Services 2.0 1.9 1.8 0.3 1.3 2.1 0.6 0.6 1.7
7 Gross private domestic investment -5.3 12.5 5.9 33.9 6.1 0.7 6.6 1.3 7.4
8 Fixed investment -1.3 12.4 15.5 10.0 9.8 4.5 0.9 14.0 3.0
9 Nonresidential -1.3 14.5 19.0 9.5 7.5 3.6 -1.8 13.2 0.4
10 Structures -28.2 35.2 20.7 11.5 12.9 0.6 0.0 16.7 -8.3
11 Equipment and software 11.1 7.8 18.3 8.8 5.4 4.8 -2.6 11.8 4.1
12 Residential -1.4 4.1 1.4 12.1 20.5 8.5 13.5 17.6 14.0
13 Change in private inventories
14 Net exports of goods and services
15 Exports 5.7 4.1 6.1 1.4 4.4 5.3 1.9 -2.8 -1.1
16 Goods 5.7 3.7 6.2 6.0 4.0 7.0 1.1 -5.0 -2.5
17 Services 5.8 5.1 6.1 -8.8 5.2 1.1 4.0 2.5 2.4
18 Imports 4.3 0.1 4.7 4.9 3.1 2.8 -0.6 -4.2 -0.4
19 Goods 5.2 -0.7 2.9 6.3 2.0 2.9 -1.2 -3.9 -1.3
20 Services -0.6 4.2 13.8 -1.7 9.0 2.3 2.6 -5.6 4.5
21 Government consumption expenditures and gross investment -7.0 -0.8 -2.9 -2.2 -3.0 -0.7 3.9 -7.0 -4.8
22 Federal -10.3 2.8 -4.3 -4.4 -4.2 -0.2 9.5 -14.8 -8.7
23 National defense -14.3 8.3 2.6 -10.6 -7.1 -0.2 12.9 -22.1 -12.0
24 Nondefense -1.7 -7.5 -17.4 10.2 1.8 -0.4 3.0 1.7 -2.1
25 State and local -4.7 -3.2 -2.0 -0.7 -2.2 -1.0 0.3 -1.5 -2.1
Addendum:
26 Gross domestic product, current dollars 2.2 5.2 4.3 4.2 4.2 2.8 5.9 1.3 3.1

US first-quarter growth was 1.8%, not 2.4% – economy

Marc Faber – Economic Predictions, Debt, Crisis, Depression

Financial Crisis, Jim Rogers Interview

Peter Schiff: Don’t get Burned by a Volatile Market

Peter Schiff ~ Where Is The Bottom In Gold?

Jim Rogers Economy Predictions 2013

USA Will Lose Economic War Jim Rogers

Background Articles and Videos

GDP Propaganda Exposed

EMBARGOED UNTIL RELEASE AT 8:30 A.M. EDT, WEDNESDAY, JUNE 26, 2013
BEA 13-30

* See the navigation bar at the right side of the news release text for links to data tables,
contact personnel and their telephone numbers, and supplementary materials.

Lisa Mataloni: (202) 606-5304 (GDP) gdpniwd@bea.gov
Kate Shoemaker: (202) 606-5564 (Profits) cpniwd@bea.gov
Recorded message: (202) 606-5306
Jeannine Aversa: (202) 606-2649 (News Media)
National Income and Product Accounts
Gross Domestic Product, 1st quarter 2013 (third estimate);
Corporate Profits, 1st quarter 2013 (revised estimate)
      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 1.8 percent in the first quarter of 2013 (that
is, from the fourth quarter to the first quarter), according to the "third" estimate released by the Bureau
of Economic Analysis.  In the fourth quarter, real GDP increased 0.4 percent.

      The GDP estimate released today is based on more complete source data than were available for
the "second" estimate issued last month.  In the second estimate, real GDP increased 2.4 percent.  With
the third estimate for the first quarter, the increase in personal consumption expenditures (PCE) was less
than previously estimated, and exports and imports are now estimated to have declined (for more
information, see "Revisions" on page 3).

      The increase in real GDP in the first quarter primarily reflected positive contributions from PCE,
private inventory investment, and residential fixed investment that were partly offset by negative
contributions from federal government spending, state and local government spending, and exports.
Imports, which are a subtraction in the calculation of GDP, decreased.

BOX._____________

     Comprehensive Revision of the National Income and Product Accounts

     BEA will release the results of the 14th comprehensive (or benchmark) revision of the national
income and product accounts (NIPAs) in conjunction with the second quarter 2013 "advance" estimate
on July 31, 2013.  More information on the revision is available on BEA’s Web site at
www.bea.gov/gdp-revisions.  An article in the March 2013 issue of the Survey of Current Business
discusses the upcoming changes in definitions and presentations, and an article in the May Survey
describes the changes in statistical methods.  Revised NIPA table stubs and news release stubs are also
available on the Web site.  An article in the September Survey will describe the estimates in detail.
________________

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 BEA’s Web site along with the Technical Note
 and Highlights related to this release.  For information on revisions, see "Revisions to GDP, GDI, and Their Major Components".
_________________

      The acceleration in real GDP in the first quarter primarily reflected an upturn in private
inventory investment, an acceleration in PCE, and smaller decreases in federal government spending and
in exports that were partly offset by a deceleration in nonresidential fixed investment and a smaller
decrease in imports.

      Motor vehicle output added 0.33 percentage point to the first-quarter change in real GDP after
adding 0.18 percentage point to the fourth-quarter change.  Final sales of computers added 0.09
percentage point to the first-quarter change in real GDP after adding 0.10 percentage point to the fourth-
quarter change.

      The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 1.2 percent in the first quarter, unrevised from the second estimate; this index increased 1.6
percent in the fourth quarter.  Excluding food and energy prices, the price index for gross domestic
purchases increased 1.5 percent in the first quarter, compared with an increase of 1.2 percent in the
fourth.

      Real personal consumption expenditures increased 2.6 percent in the first quarter, compared with
an increase of 1.8 percent in the fourth.  Durable goods increased 7.6 percent, compared with an increase
of 13.6 percent.  Nondurable goods increased 2.8 percent, compared with an increase of 0.1 percent.
Services increased 1.7 percent, compared with an increase of 0.6 percent.

      Real nonresidential fixed investment increased 0.4 percent in the first quarter, compared with an
increase of 13.2 percent in the fourth.  Nonresidential structures decreased 8.3 percent, in contrast to an
increase of 16.7 percent.  Equipment and software increased 4.1 percent, compared with an increase of
11.8 percent.  Real residential fixed investment increased 14.0 percent, compared with an increase of
17.6 percent.

      Real exports of goods and services decreased 1.1 percent in the first quarter, compared with a
decrease of 2.8 percent in the fourth.  Real imports of goods and services decreased 0.4 percent,
compared with a decrease of 4.2 percent.

      Real federal government consumption expenditures and gross investment decreased 8.7 percent
in the first quarter, compared with a decrease of 14.8 percent in the fourth.  National defense decreased
12.0 percent, compared with a decrease of 22.1 percent.  Nondefense decreased 2.1 percent, in contrast
to an increase of 1.7 percent.  Real state and local government consumption expenditures and gross
investment decreased 2.1 percent, compared with a decrease of 1.5 percent.

      The change in real private inventories added 0.57 percentage point to the first-quarter change in
real GDP, after subtracting 1.52 percentage points from the fourth-quarter change.  Private businesses
increased inventories $36.7 billion in the first quarter, following increases of $13.3 billion in the fourth
quarter and $60.3 billion in the third.

      Real final sales of domestic product -- GDP less change in private inventories -- increased 1.2
percent in the first quarter, compared with an increase of 1.9 percent in the fourth.

Gross domestic purchases

      Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever
produced -- increased 1.8 percent in the first quarter; it was unchanged in the fourth.

Gross national product

      Real gross national product -- the goods and services produced by the labor and property
supplied by U.S. residents -- increased 1.2 percent in the first quarter, compared with an increase of 0.9
percent in the fourth.  GNP includes, and GDP excludes, net receipts of income from the rest of the
world, which decreased $17.7 billion in the first quarter after increasing $19.2 billion in the fourth; in
the first quarter, receipts decreased $16.3 billion, and payments increased $1.4 billion.

Current-dollar GDP

      Current-dollar GDP -- the market value of the nation's output of goods and services -- increased
3.1 percent, or $120.0 billion, in the first quarter to a level of $15,984.1 billion.  In the fourth quarter,
current-dollar GDP increased 1.3 percent, or $53.1 billion.

Gross domestic income

      Real gross domestic income (GDI), which measures the output of the economy as the costs
incurred and the incomes earned in the production of GDP, increased 2.5 percent in the first quarter,
compared with an increase of 5.5 percent in the fourth.  For a given quarter, the estimates of GDP and
GDI may differ for a variety of reasons, including the incorporation of largely independent source data.
However, over longer time spans, the estimates of GDP and GDI tend to follow similar patterns of
change.

Revisions

      The downward revision to the percent change in real GDP primarily reflected downward
revisions to personal consumption expenditures, to exports, and to nonresidential fixed investment that
were partly offset by a downward revision to imports.

                                             Advance Estimate         Second Estimate         Third Estimate
				        		(Percent change from preceding quarter)

Real GDP......................................     2.5                     2.4                     1.8
Current-dollar GDP............................     3.7                     3.6                     3.1
Gross domestic purchases price index..........     1.1                     1.2                     1.2

                                              Corporate Profits

      Profits from current production (corporate profits with inventory valuation and capital
consumption adjustments) decreased $28.0 billion in the first quarter, in contrast to an increase of $45.4
billion in the fourth quarter.  Current-production cash flow (net cash flow with inventory valuation
adjustment) -- the internal funds available to corporations for investment -- increased $125.6 billion in
the first quarter, in contrast to a decrease of $89.8 billion in the fourth.

      Taxes on corporate income decreased $10.5 billion in the first quarter, compared with a decrease
of $4.4 billion in the fourth.  Profits after tax with inventory valuation and capital consumption
adjustments decreased $17.5 billion in the first quarter, in contrast to an increase of $49.8 billion in the
fourth.  Dividends decreased $103.5 billion, in contrast to an increase of $124.3 billion.  The large
fourth-quarter increase reflected accelerated and special dividends paid by corporations at the end of
2012 in anticipation of changes to individual income tax rates.   Current-production undistributed profits
increased $85.8 billion, in contrast to a decrease of $74.3 billion.

      Domestic profits of financial corporations decreased $3.4 billion in the first quarter, compared
with a decrease of $3.5 billion in the fourth.  Domestic profits of nonfinancial corporations decreased
$5.0 billion in the first quarter, in contrast to an increase of $24.8 billion in the fourth.  In the first
quarter, real gross value added of nonfinancial corporations increased, and profits per unit of real value
added decreased.  The decrease in unit profits reflected an increase in the unit nonlabor costs incurred by
corporations that was partly offset by a decrease in unit labor costs; unit prices were unchanged.

      The rest-of-the-world component of profits decreased $19.6 billion in the first quarter, in contrast
to an increase of $24.1 billion in the fourth.  This measure is calculated as (1) receipts by U.S. residents
of earnings from their foreign affiliates plus dividends received by U.S. residents from unaffiliated
foreign corporations minus (2) payments by U.S. affiliates of earnings to their foreign parents plus
dividends paid by U.S. corporations to unaffiliated foreign residents.  The first-quarter decrease was
accounted for by a larger decrease in receipts than in payments.

      Profits before tax with inventory valuation adjustment is the best available measure of industry
profits because estimates of the capital consumption adjustment by industry do not exist.  This measure
reflects depreciation-accounting practices used for federal income tax returns.  According to this
measure, domestic profits of both financial and nonfinancial corporations decreased.  The decrease in
nonfinancial corporations primarily reflected decreases in "other" nonfinancial and in manufacturing that
were partly offset by increases in information and in wholesale trade.  Within manufacturing, the largest
decreases were in petroleum and coal products and in machinery.

      Profits before tax decreased $34.7 billion in the first quarter, in contrast to an increase of $27.3
billion in the fourth.  The before-tax measure of profits does not reflect, as does profits from current
production, the capital consumption and inventory valuation adjustments.  These adjustments convert
depreciation of fixed assets and inventory withdrawals reported on a tax-return, historical-cost basis to
the current-cost measures used in the national income and product accounts.  The capital consumption
adjustment increased $12.5 billion in the first quarter (from -$199.5 billion to -$187.0 billion), compared
with an increase of $0.5 billion in the fourth.  The inventory valuation adjustment decreased $5.8 billion
(from -$9.2 billion to -$15.0 billion), in contrast to an increase of $17.6 billion.

      The first-quarter changes in taxes on corporate income and in the capital consumption
adjustment mainly reflect the expiration of bonus depreciation claimed under the American Taxpayer
Relief Act of 2012.  For detailed data, see the table "Net Effects of the Tax Acts of 2002, 2003, 2008,
2009, 2010, and 2012 on Selected Measures of Corporate Profits" at
www.bea.gov/national/xls/technote_tax_acts.xls.  Profits from current production are not affected
because they do not depend on the depreciation-accounting practices used for federal income tax returns;
rather, they are based on depreciation of fixed assets valued at current cost using consistent depreciation
profiles based on used-asset prices. For more details on the effect of tax act provisions on the capital
consumption adjustment, see FAQ #999 on the BEA Web site, "Why does the capital consumption
adjustment for domestic business decline so much in the first quarter of 2012?"

                                        *          *          *

      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 -- July 31, 2013, at 8:30 A.M. EDT for:
                    Gross Domestic Product:  Second Quarter 2013 (Advance Estimate)
                  Comprehensive Revision of the National Income and Product Accounts
                                  (1929 through First Quarter 2013)

Real GDP Per Capita: Another Perspective On The Economy

Earlier Friday we learned that the Advance Estimate for Q1 2013 real GDP came in at 2.5 percent, up from 0.4 percent in Q4 2012. Let’s now review the numbers on a per-capita basis.

For an alternate historical view of the economy, here is a chart of real GDP per-capita growth since 1960. For this analysis I’ve chained in today’s dollar for the inflation adjustment. The per-capita calculation is based on quarterly aggregates of mid-month population estimates by the Bureau of Economic Analysis, which date from 1959 (hence my 1960 starting date for this chart, even though quarterly GDP has is available since 1947). The population data is available in the FRED series POPTHM. The logarithmic vertical axis ensures that the highlighted contractions have the same relative scale.

I’ve drawn an exponential regression through the data using the Excel GROWTH() function to give us a sense of the historical trend. The regression illustrates the fact that the trend since the Great Recession has a visibly lower slope than long-term trend. In fact, the current GDP per-capita is 11.6% below the regression trend.

(click to enlarge)

The real per-capita series gives us a better understanding of the depth and duration of GDP contractions. As we can see, since our 1960 starting point, the recession that began in December 2007 is associated with a deeper trough than previous contractions, which perhaps justifies its nickname as the Great Recession. In fact, at this point, 20 quarters beyond the 2007 GDP peak, real GDP per capita is still 1.04% off the all-time high following the deepest trough in the series.

Here is a more revealing snapshot of real GDP per capita, specifically illustrating the percent off the most recent peak across time, with recessions highlighted. The underlying calculation is to show peaks at 0% on the right axis. The callouts shows the percent off real GDP per-capita at significant troughs as well as the current reading for this metric.

(click to enlarge)
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U.S. Real Gross Domestic Product Growth Still Stagnating At 2.4% in First Quarter of 2013 As Institute for Supply Management Factory Index Sinks to 49.0 Lowest Since June 2009 — Videos

Posted on June 3, 2013. Filed under: American History, Banking, Blogroll, Business, College, Communications, Economics, Education, Employment, Energy, Farming, Federal Government, Federal Government Budget, Fiscal Policy, Foreign Policy, government, government spending, Health Care, history, History of Economic Thought, Illegal, Immigration, Inflation, Investments, Law, liberty, Life, Links, Macroeconomics, media, Monetary Policy, Money, People, Philosophy, Politics, Press, Raves, Regulations, Security, Strategy, Talk Radio, Tax Policy, Taxes, Video, War, Wisdom | Tags: , , , , , , , , , , , , , , , |

gdp_largegdpind12_adv_chart_01

Table 1.1.1. Percent Change From Preceding Period in Real Gross Domestic Product

[Percent] Seasonally adjusted at annual rates

Last Revised on: May 30, 2013 – Next Release Date June 26, 2013

Line 2011 2012 2013
I II III IV I II III IV I
1 Gross domestic product 0.1 2.5 1.3 4.1 2.0 1.3 3.1 0.4 2.4
2 Personal consumption expenditures 3.1 1.0 1.7 2.0 2.4 1.5 1.6 1.8 3.4
3 Goods 5.4 -1.0 1.4 5.4 4.7 0.3 3.6 4.3 4.1
4 Durable goods 7.3 -2.3 5.4 13.9 11.5 -0.2 8.9 13.6 8.2
5 Nondurable goods 4.6 -0.3 -0.4 1.8 1.6 0.6 1.2 0.1 2.2
6 Services 2.0 1.9 1.8 0.3 1.3 2.1 0.6 0.6 3.1
7 Gross private domestic investment -5.3 12.5 5.9 33.9 6.1 0.7 6.6 1.3 9.0
8 Fixed investment -1.3 12.4 15.5 10.0 9.8 4.5 0.9 14.0 4.1
9 Nonresidential -1.3 14.5 19.0 9.5 7.5 3.6 -1.8 13.2 2.2
10 Structures -28.2 35.2 20.7 11.5 12.9 0.6 0.0 16.7 -3.5
11 Equipment and software 11.1 7.8 18.3 8.8 5.4 4.8 -2.6 11.8 4.6
12 Residential -1.4 4.1 1.4 12.1 20.5 8.5 13.5 17.6 12.1
13 Change in private inventories
14 Net exports of goods and services
15 Exports 5.7 4.1 6.1 1.4 4.4 5.3 1.9 -2.8 0.8
16 Goods 5.7 3.7 6.2 6.0 4.0 7.0 1.1 -5.0 0.3
17 Services 5.8 5.1 6.1 -8.8 5.2 1.1 4.0 2.5 2.0
18 Imports 4.3 0.1 4.7 4.9 3.1 2.8 -0.6 -4.2 1.9
19 Goods 5.2 -0.7 2.9 6.3 2.0 2.9 -1.2 -3.9 1.1
20 Services -0.6 4.2 13.8 -1.7 9.0 2.3 2.6 -5.6 5.8
21 Government consumption expenditures and gross investment -7.0 -0.8 -2.9 -2.2 -3.0 -0.7 3.9 -7.0 -4.9
22 Federal -10.3 2.8 -4.3 -4.4 -4.2 -0.2 9.5 -14.8 -8.7
23 National defense -14.3 8.3 2.6 -10.6 -7.1 -0.2 12.9 -22.1 -12.1
24 Nondefense -1.7 -7.5 -17.4 10.2 1.8 -0.4 3.0 1.7 -2.1
25 State and local -4.7 -3.2 -2.0 -0.7 -2.2 -1.0 0.3 -1.5 -2.4
Addendum:
26 Gross domestic product, current dollars 2.2 5.2 4.3 4.2 4.2 2.8 5.9 1.3 3.6

Fed’s Advisory Council Admits We’re Screwed

Even more amazing than the admission is how long it took them to figure it out. However the most amazing aspect of all is the lack of reaction. The mainstream media, including the financial media, has completely ignored the warning. It’s as if the report doesn’t even exit. Perhaps it’s part of a psychological defense mechanism whereby any information that casts doubt on the recovery myth, no matter how credible the source, is conveniently ignored.

US ECONOMY GROWS 2 4% IN Q1

U.S. GDP In Q1 Revised Lower As Austerity Measures Bite

Peter Schiff US Economy Living On Borrowed Time..

Peter Schiff predicts another economic crash

EMBARGOED UNTIL RELEASE AT 8:30 A.M. EDT, THURSDAY, MAY 30, 2013
BEA 13-21

* See the navigation bar at the right side of the news release text for links to data tables,
contact personnel and their telephone numbers, and supplementary materials.

Lisa S. Mataloni: (202) 606-5304 (GDP) gdpniwd@bea.gov
Andrew Hodge: (202) 606-5564 (Profits) cpniwd@bea.gov
Recorded message: (202) 606-5306
Jeannine Aversa: (202) 606-2649 (News Media)
National Income and Product Accounts
Gross Domestic Product, 1st quarter 2013 (second estimate);
Corporate Profits, 1st quarter 2013 (preliminary estimate)
      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 2.4 percent in the first quarter of 2013 (that
is, from the fourth quarter to the first quarter), according to the "second" estimate released by the Bureau
of Economic Analysis.  In the fourth quarter, real GDP increased 0.4 percent.

      The GDP estimate released today is based on more complete source data than were available for
the "advance" estimate issued last month.  In the advance estimate, real GDP increased 2.5 percent.
With the second estimate for the first quarter, increases in private inventory investment, in exports, and
in imports were less than previously estimated, but the general picture of overall economic activity is not
greatly changed (for more information, see "Revisions" on page 4).

BOX.______

     Comprehensive Revision of the National Income and Product Accounts

     BEA plans to release the results of the 14th comprehensive (or benchmark) revision of the national
income and product accounts (NIPAs) in conjunction with the second quarter 2013 "advance" estimate
on July 31, 2013.  More information on the revision is available on BEA’s Web site at
www.bea.gov/gdp-revisions.  An article in the March 2013 issue of the Survey of Current Business
discusses the upcoming changes in definitions and presentations, and an article in the May Survey
describes the changes in statistical methods.  An article in the September Survey will describe the
estimates in detail.  Revised NIPA table stubs and news release stubs will be available in June.

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 BEA's Web site along with the Technical Note
and Highlights related to this release.  For information on revisions, see 
"Revisions to GDP, GDI, and Their Major Components".

________________

      The increase in real GDP in the first quarter primarily reflected positive contributions from
personal consumption expenditures (PCE), private inventory investment, residential fixed investment,
nonresidential fixed investment, and exports that were partly offset by negative contributions from
federal government spending and state and local government spending.  Imports, which are a subtraction
in the calculation of GDP, increased.

      The acceleration in real GDP in the first quarter primarily reflected an upturn in private
inventory investment, an acceleration in PCE, a smaller decrease in federal government spending, and
an upturn in exports that were partly offset by an upturn in imports and a deceleration in nonresidential
fixed investment.

      Motor vehicle output added 0.28 percentage point to the first-quarter change in real GDP after
adding 0.18 percentage point to the fourth-quarter change.  Final sales of computers added 0.02
percentage point to the first-quarter change in real GDP after adding 0.10 percentage point to the fourth-
quarter change.

      The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 1.2 percent in the first quarter, 0.1 percentage point more than in the advance estimate; this
index increased 1.6 percent in the fourth quarter.  Excluding food and energy prices, the price index for
gross domestic purchases increased 1.4 percent in the first quarter, compared with an increase of 1.2
percent in the fourth.

      Real personal consumption expenditures increased 3.4 percent in the first quarter, compared with
an increase of 1.8 percent in the fourth.  Durable goods increased 8.2 percent, compared with an increase
of 13.6 percent.  Nondurable goods increased 2.2 percent, compared with an increase of 0.1 percent.
Services increased 3.1 percent, compared with an increase of 0.6 percent.

      Real nonresidential fixed investment increased 2.2 percent in the first quarter, compared with an
increase of 13.2 percent in the fourth.  Nonresidential structures decreased 3.5 percent, in contrast to an
increase of 16.7 percent.  Equipment and software increased 4.6 percent, compared with an increase of
11.8 percent.  Real residential fixed investment increased 12.1 percent, compared with an increase of
17.6 percent.

      Real exports of goods and services increased 0.8 percent in the first quarter, in contrast to a
decrease of 2.8 percent in the fourth.  Real imports of goods and services increased 1.9 percent, in
contrast to a decrease of 4.2 percent.

      Real federal government consumption expenditures and gross investment decreased 8.7 percent
in the first quarter, compared with a decrease of 14.8 percent in the fourth.  National defense decreased
12.1 percent, compared with a decrease of 22.1 percent.  Nondefense decreased 2.1 percent, in contrast
to an increase of 1.7 percent.  Real state and local government consumption expenditures and gross
investment decreased 2.4 percent, compared with a decrease of 1.5 percent.

      The change in real private inventories added 0.63 percentage point to the first-quarter change in
real GDP, after subtracting 1.52 percentage points from the fourth-quarter change.  Private businesses
increased inventories $38.3 billion in the first quarter, following an increases of $13.3 billion in the
fourth quarter and $60.3 billion in the third.

      Real final sales of domestic product -- GDP less change in private inventories -- increased 1.8
percent in the first quarter, compared with an increase of 1.9 percent in the fourth.

Gross domestic purchases

      Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever
produced -- increased 2.5 percent in the first quarter; it was unchanged in the fourth quarter.

Gross national product

      Real gross national product -- the goods and services produced by the labor and property
supplied by U.S. residents -- increased 1.5 percent in the first quarter, compared with an increase of 0.9
percent in the fourth.  GNP includes, and GDP excludes, net receipts of income from the rest of the
world, which decreased $30.3 billion in the first quarter after increasing $19.2 billion in the fourth; in
the first quarter, receipts decreased $20.8 billion, and payments increased $9.5 billion.

Current-dollar GDP

      Current-dollar GDP -- the market value of the nation's output of goods and services -- increased
3.6 percent, or $140.4 billion, in the first quarter to a level of $16,004.5 billion.  In the fourth quarter,
current-dollar GDP increased 1.3 percent, or $53.1 billion.

Gross domestic income

      Real gross domestic income (GDI), which measures the output of the economy as the costs
incurred and the incomes earned in the production of GDP, increased 2.5 percent in the first quarter,
compared with an increase of 5.5 percent (revised) in the fourth.  For a given quarter, the estimates of
GDP and GDI may differ for a variety of reasons, including the incorporation of largely independent
source data.  However, over longer time spans, the estimates of GDP and GDI tend to follow similar
patterns of change.

Revisions

      The "second" estimate of the third-quarter percent change in GDP is 0.1 percentage point, or
$3.9 billion, less than the advance estimate issued last month, primarily reflecting downward revisions
to private inventory investment, to exports, and to state and local government spending that were partly
offset by a downward revision to imports and an upward revision to personal consumption expenditures.

                                                                     Advance Estimate             Second Estimate
                                                                       (Percent change from preceding quarter)

Real GDP..........................................                          2.5                        2.4
Current-dollar GDP................................                          3.7                        3.6
Gross domestic purchases price index..............                          1.1                        1.2

                                             Corporate Profits

      Profits from current production (corporate profits with inventory valuation and capital
consumption adjustments) decreased $43.8 billion in the first quarter, in contrast to an increase of $45.4
billion in the fourth.  Current-production cash flow (net cash flow with inventory valuation adjustment) -
- the internal funds available to corporations for investment -- increased $110.9 billion in the first
quarter, in contrast to a decrease of $89.8 billion in the fourth.

      Taxes on corporate income decreased $13.6 billion in the first quarter, compared with a decrease
of $4.4 billion in the fourth.  Profits after tax with inventory valuation and capital consumption
adjustments decreased $30.2 billion in the first quarter, in contrast to an increase of $49.8 billion in the
fourth.  Dividends decreased $101.7 billion in contrast to an increase of $124.3 billion. The large fourth-
quarter increase reflected accelerated and special dividends paid by corporations at the end of 2012 in
anticipation of changes to individual income tax rates.  Current-production undistributed profits
increased $71.4 billion, in contrast to a decrease of $74.3 billion.

      Domestic profits of financial corporations decreased $2.0 billion in the first quarter, compared
with a decrease of $3.5 billion in the fourth.  Domestic profits of nonfinancial corporations decreased
$8.8 billion in the first quarter, in contrast to an increase of $24.8 billion in the fourth.  In the first
quarter, real gross value added of nonfinancial corporations increased, and profits per unit of real value
added decreased.  The decrease in unit profits reflected an increase in the unit nonlabor costs incurred by
corporations that was partly offset by a decrease in unit labor costs; unit prices were unchanged.

      The rest-of-the-world component of profits decreased $33.0 billion in the first quarter, in contrast
to an increase of $24.1 billion in the fourth.  This measure is calculated as (1) receipts by U.S. residents
of earnings from their foreign affiliates plus dividends received by U.S. residents from unaffiliated
foreign corporations minus (2) payments by U.S. affiliates of earnings to their foreign parents plus
dividends paid by U.S. corporations to unaffiliated foreign residents.  The first-quarter decrease was
accounted for by a decrease in receipts and an increase in payments.

      Profits before tax decreased $49.8 billion in the first quarter, in contrast to an increase of $27.3
billion in the fourth.  The before-tax measure of profits does not reflect, as does profits from current
production, the capital consumption and inventory valuation adjustments.  These adjustments convert
depreciation of fixed assets and inventory withdrawals reported on a tax-return, historical-cost basis to
the current-cost measures used in the national income and product accounts.  The capital consumption
adjustment increased $12.9 billion in the first quarter (from -$199.5 billion to -$186.6 billion), compared
with an increase of $0.5 billion in the fourth.  The inventory valuation adjustment decreased $6.9 billion
(from -$9.2 billion  to -$16.1 billion), in contrast to an increase of $17.6 billion.

	The first-quarter changes in taxes on corporate income and in the capital consumption
adjustment mainly reflect the expiration of bonus depreciation claimed under the American Taxpayer
Relief Act of 2012.  For detailed data, see the table "Net Effects of the Tax Acts of 2002, 2003, 2008,
2009, 2010, and 2012 on Selected Measures of Corporate Profits" at
www.bea.gov/national/xls/technote_tax_acts.xls.  Profits from current production are not affected
because they do not depend on the depreciation-accounting practices used for federal income tax returns;
rather, they are based on depreciation of fixed assets valued at current cost using consistent depreciation
profiles based on used-asset prices. For more details on the effect of tax act provisions on the capital
consumption adjustment, see FAQ #999 on the BEA Web site, "Why does the capital consumption
adjustment for domestic business decline so much in the first quarter of 2012?".

                                            *          *          *

      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 -- June 26, 2013, at 8:30 A.M. EDT for:
                           Gross Domestic Product:  First Quarter 2013 (Third Estimate)
                           Corporate Profits:  First Quarter (Revised Estimate)

Surprise Manufacturing Downturn Holds Back U.S. Growth: Economy

 By Shobhana Chandra

the U.S. unexpectedly shrank in May at the fastest pace in four years, showing slowdowns in business and government spending are holding back the world’s largest economy.

The Institute for Supply Management’s factory index fell to 49, the lowest reading since June 2009, from the prior month’s 50.7, the Tempe, Arizona-based group’s report showed today. Fifty is the dividing line between growth and contraction. The median forecast of 81 economists surveyed by Bloomberg was 51.

Across-the-board federal budget cuts and overseas markets that are struggling to rebound will probably continue to curb manufacturing, which accounts for about 12 percent of the economy. At the same time, demand for automobiles, gains in residential construction and lean inventories may spark a pickup in orders and production in the second half of the year.

“Manufacturing is really stymied by slow corporate spending and government spending cutbacks,” said Guy LeBas, chief fixed-income strategist at Janney Montgomery Scott LLC in Philadelphia, who was the only analyst in the Bloomberg survey to correctly project the drop in the index. “Manufacturing will grow at a modest pace this year” although it “is unlikely to accelerate in coming months,” LeBas said. “This is part of the slower expansion we’ll have in the second quarter.”

Estimates in the Bloomberg survey ranged from 49 to 54.

Stocks fluctuated between gains and losses after the report. The Standard & Poor’s 500 Index fell 0.3 percent to 1,626.19 at 12:39 p.m. in New York. The gauge had posted its first consecutive weekly losses since November.

http://www.bloomberg.com/news/2013-06-03/may-ism-manufacturing-index-decreased-to-49-from-50-7-in-april.html

Manufacturing sector contracts in May: ISM

Manufacturing activity contracted in May for the first time in six months as new orders slipped and there was less demand for exports, an industry report showed on Monday.

The Institute for Supply Management (ISM) said its index of national factory activity in May fell to 49.0 from 50.7 in April, short of expectations for 50.7.

A reading below 50 indicates contraction in the manufacturing sector. The last time the ISM manufacturing index fell below 50 was November 2012, shortly after the U.S. east coast was hit by a massive storm.

The gauge for new orders dropped to 48.8 from 52.3, while a measure of employment edged down to 50.1 from 50.2. Production fell to 48.6 from 53.5.

The exports index fell to 51.0 from 54.0, while imports held up relatively better, slipping slightly to 54.5 from 55.0.

Though growth has cooled in recent months, before May the national reading had managed to stay in expansion territory, unlike some regional reports that have shown shrinkage.

Economic growth overall in the second quarter is expected to slow from the first quarter’s 2.4 percent pace.

http://www.newsdaily.com/business/28c9c04463c338dbc2557a604a2a7502/manufacturing-sector-contracts-in-may-ism

Fed’s Advisory Council of bankers warns of risks posed by QE3

A Federal Reserve advisory panel of bankers issued a stark warning to the U.S. central bank earlier this month over the dangers of its massive bond purchases, according to documents released on Friday.

“Current policy has created systemic financial risks and potential structural problems for banks,” the Federal Advisory Council noted, according to minutes of its meeting on May 17, which the Fed posted on its public website.

In February, the council, made up of 12 representatives from the banking industry who meet four times a year, stated that it continued to support the Fed’s accommodative monetary policy.

In May, there was an acknowledgment that the policies had provided support for a slow recovery, but no explicit backing.

“However, the effectiveness of the policies in producing healthy economic and employment growth is not clear. Uncertainty about fiscal and monetary policy is deterring business investment that would spur growth,” the Council noted.

Fed officials say they are mindful of the potential costs of a campaign of their massive bond purchases, aimed at spurring growth by holding down borrowing costs, and have signaled that they may scale back buying if the economy continues to improve over the next few months.

The program, currently running at an $85 billon monthly pace, has harsh critics. The Advisory Council echoed some of these concerns in its May meeting, including a trend of low rates pushing investors into riskier assets to make up for lost yield.

The Advisory Council also noted that the Fed’s campaign of so called quantitative easing, which entered a third stage – dubbed QE3 – in September, has tripled the Fed’s balance sheet to around $3.3 trillion, and could be disruptive to exit.

“Uncertainty exists about how markets will reestablish normal valuations when the Fed withdraws from the market. It will likely be difficult to unwind policy accommodation.”

Each of the Fed’s 12 regional branches chooses a banker from its district to sit on the council, whose members include Joseph Hooley, head of Boston’s State Street Corp ; James Gorman, boss of Morgan Stanley in New York; and Kelly King, head of BB&T Corp in Winston-Salem, North Carolina. (Reporting By Alister Bull; Editing by Nick Zieminski)

http://www.reuters.com/article/2013/05/31/usa-fed-council-idUSL2N0EC1KX20130531

 

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2.5% First Quarter 2013 Real Annual Growth in Gross Domestic Product (GDP) — Stagflation — Government GDP Calculation of Investment To Include Intangibles R&D — Videos

Posted on April 26, 2013. Filed under: American History, Blogroll, Business, College, Communications, Economics, Education, Employment, Federal Government, Federal Government Budget, Fiscal Policy, government, government spending, history, History of Economic Thought, Investments, Law, liberty, Life, Links, Literacy, Macroeconomics, media, Microeconomics, People, Philosophy, Politics, Raves, Talk Radio, Tax Policy, Taxes, Technology, Unions, Video, War, Wisdom | Tags: , , , , , , , |

gdp_large

Ken Langone: Regulation Biggest Issue Hurting U.S. Economy

April 26 (Bloomberg) — Ken Langone, founder & CEO at Invemed Associates, talks with Bloomberg’s Erik Schatzker and Sara Eisen about first-quarter U.S. GDP, the impact of regulations and the anti-business stance of the Obama Administration. He speaks on Bloomberg Television’s “Market Makers.”

Peter Schiff We re in Depression, Dollar Crisis Coming

[

GDP Propaganda Exposed

Data shift to lift US economy 3%

By Robin Harding in Washington

The US economy will officially become 3 per cent bigger in July as part of a shake-up that will see government statistics take into account 21st century components such as film royalties and spending on research and development.

Billions of dollars of intangible assets will enter the gross domestic product of the world’s largest economy in a revision aimed at capturing the changing nature of US output.

Brent Moulton, who manages the national accounts at the Bureau of Economic Analysis, told the Financial Times that the update was the biggest since computer software was added to the accounts in 1999.

“We are carrying these major changes all the way back in time – which for us means to 1929 – so we are essentially rewriting economic history,” said Mr Moulton.

The changes will affect everything from the measured GDP of different US states to the stability of the inflation measure targeted by the Federal Reserve. They will force economists to revisit policy debates about everything from corporate profits to the causes of economic growth.

The revision, equivalent to adding a country as big as Belgium to the estimated size of the world economy, will make the US one of the first adopters of a new international standard for GDP accounting.

“We’re capitalising research and development and also this category referred to as entertainment, literary and artistic originals, which would be things like motion picture originals, long-lasting television programmes, books and sound recordings,” said Mr Moulton.

At present, R&D counts as a cost of doing business, so the final output of Apple iPads is included in GDP but the research done to create them is not. R&D will now count as an investment, adding a bit more than 2 per cent to the measured size of the economy.

GDP will soar in small states that host a lot of military R&D, but barely change in others, widening measured income gaps across the US. R&D is expected to boost the GDP of New Mexico by 10 per cent and Maryland by 6 per cent while Louisiana will see an increase of just 0.6 per cent.

Creative works are expected to add a further 0.5 per cent to the overall size of the US economy. Around one-third of that will come from movies, one-third from TV programmes, and one-third from books, music and theatre.

Deficits in defined benefit pension schemes will also be included because what companies have promised to pay out will be measured, rather than the cash they pay into plans.

“We will now show a liability for underfunded plans, which particularly has large ramifications for the government sector, where both at the state level and the federal level we have large underfunded plans,” said Mr Moulton.

The changes are in addition to a comprehensive revision of the national accounts that takes place every five years based on an economic census of nearly 4m US businesses.

Steve Landefeld, BEA director, said it was hard to predict the overall outcome given the mixture of new methodology and data updates. “What’s going to happen when you mix it with the new source data from the economic census . . . I don’t know,” he said.

But he said the revisions were unlikely to alter the picture of what has happened to the economy in recent years. “I wouldn’t be looking for large changes in trends or cycles.”

http://www.ft.com/cms/s/0/52d23fa6-aa98-11e2-bc0d-00144feabdc0.html#axzz2Rb5G6QBg

US GDP Will Be Revised Higher By $500 Billion Following Addition Of “Intangibles” To Economy

Submitted by Tyler Durden

Those who have been following the US debt to GDP ratio now that the US officially does not have a debt ceiling indefinitely, may have had the occasional panic attack seeing how this country’s leverage ratio is rapidly approaching that of a Troika case study of a PIIG in complete failure. And at 107% debt/GDP no explanations are necessary. Luckily, the official gatekeepers of America’s economic growth (with decimal point precision), the Bureau of Economic Analysis have a plan on how to make the US economy, which is now growing at an abysmal 1.5% annualized pace, or about 5 times slower than US debt growing at 7.5% annually, catch up: magically make up a number out of thin air, and add it to the total. And it literally is out of thin air: according to the FT the addition will constitute of a one-time addition of intangibles, amounting to 3% of total US GDP, or more than the size of Belgium at $500 billion, to the US economy.

From FT:

The US economy will officially become 3 per cent bigger in July as part of a shake-up that will see government statistics take into account 21st century components such as film royalties and spending on research and development.

Billions of dollars of intangible assets will enter the gross domestic product of the world’s largest economy in a revision aimed at capturing the changing nature of US output.

Brent Moulton, who manages the national accounts at the Bureau of Economic Analysis, told the Financial Times that the update was the biggest since computer software was added to the accounts in 1999.

“We are carrying these major changes all the way back in time – which for us means to 1929 – so we are essentially rewriting economic history,” said Mr Moulton.

What exactly will constitute GDP growth going forward? In a word, intangibles: films, books, magazines and iTunes songs.

“We’re capitalising research and development and also this category referred to as entertainment, literary and artistic originals, which would be things like motion picture originals, long-lasting television programmes, books and sound recordings,” said Mr Moulton.

At present, R&D counts as a cost of doing business, so the final output of Apple iPads is included in GDP but the research done to create them is not. R&D will now count as an investment, adding a bit more than 2 per cent to the measured size of the economy.

Nothing like adding intangibles in the fluid, ever-changing definition of what constitutes an economy.

Naturally, the only reason for this artificial “boost” to the US economy which apparently can be any old arbitrary number agreed upon by a few accountants, and which always goes up post revision, never down, is to make US debt/GDP under 100% once again, if only very briefly. Surely a few months later something else can be “added” to GDP making the US economy appear better than it is once more.

Finally, all of the above is a distraction for idiots.

As most people should know by know (this logically excludes economists), the only factor leading to economic “growth” is the expansion of liabilities of the financial system, whereby new credit (in a healthy environment, not one centrally-planned by several Princeton real-world rejects, where the central bank is forced to create all credit expansion with money that never leaves the banks and the capital markets closed loop) creates new money, creates demand for products and services, and circulates in the economy.

This can be seen in the chart below which shows the nearly perfect correlation between total bank liabilities in the US, as per the Fed’s Flow Of Funds report, and total US GDP.

Bottom line: the BEA can capitalize air consumption if it thinks it will make US GDP soar, but unless new credit and bank liabilities are created not due to forced supply but demand, and unless the private financial sector is finally willing to start lending money (which for the entire duration of QE it has not) US growth will stall and then proceed to decline.

Case in point: total US commerical bank loans are still lower than they were the day Lehman filed.

In other words, all the GDP “growth” since the Lehman failure has come on the back of money “created” by the Fed.

And there are still those who think the Fed will ever unwind…

http://www.zerohedge.com/news/2013-04-21/us-gdp-will-be-revised-higher-500-billion-following-addition-intangibles-economy

EMBARGOED UNTIL RELEASE AT 8:30 A.M. EDT, FRIDAY, APRIL 26, 2013
BEA 13-18

* See the navigation bar at the right side of the news release text for links to data tables,
contact personnel and their telephone numbers, and supplementary materials.

Lisa S. Mataloni: (202) 606-5304 (GDP) gdpniwd@bea.gov
Recorded message: (202) 606-5306
Jeannine Aversa: (202) 606-2649 (News Media)
National Income and Product Accounts
Gross Domestic Product, First Quarter 2013 (advance estimate)
      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 2.5 percent in the first quarter of 2013 (that
is, from the fourth quarter to the first quarter), according to the "advance" estimate released by the
Bureau of Economic Analysis.  In the fourth quarter, real GDP increased 0.4 percent.

      The Bureau emphasized that the first-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 3 and
"Comparisons of Revisions to GDP" on page 5).  The "second" estimate for the first quarter, based on
more complete data, will be released on May 30, 2013.

      The increase in real GDP in the first quarter primarily reflected positive contributions from
personal consumption expenditures (PCE), private inventory investment, exports, residential investment,
and nonresidential fixed investment that were partly offset by negative contributions from federal
government spending and state and local government spending.  Imports, which are a subtraction in the
calculation of GDP, increased.

BOX_______________________
     Comprehensive Revision of the National Income and Product Accounts

     BEA plans to release the results of the 14th comprehensive (or benchmark) revision of the national
income and product accounts (NIPAs) in conjunction with the second quarter 2013 "advance" estimate
on July 31, 2013.  More information on the revision is available on BEA’s Web site at
www.bea.gov/gdp-revisions, including a link to an article in the March 2013 issue of the Survey of
Current Business that discusses the upcoming changes in definitions and presentations, including
capitalizing spending on research and development and on entertainment originals and measuring
transactions of defined benefit pension plans on an accrual accounting basis.  An article in the May
Survey will describe changes in statistical methods, and an article in the September Survey will describe
the estimates in detail.  Revised NIPA table stubs and news release stubs will be available in June.

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 Note and highlights related to this release.
___________________________

      The acceleration in real GDP in the first quarter primarily reflected an upturn in private
inventory investment, an acceleration in PCE, an upturn in exports, and a smaller decrease in federal
government spending that were partly offset by an upturn in imports and a deceleration in nonresidential
fixed investment.

      Motor vehicle output added 0.24 percentage point to the first-quarter change in real GDP after
adding 0.18 percentage point to the fourth-quarter change.  Final sales of computers subtracted 0.01
percentage point from the first-quarter change in real GDP after adding 0.10 percentage point to the
fourth-quarter change.

      The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 1.1 percent in the first quarter, compared with an increase of 1.6 percent in the fourth.
Excluding food and energy prices, the price index for gross domestic purchases increased 1.3 percent in
the first quarter, compared with an increase of 1.2 percent in the fourth.

      Real personal consumption expenditures increased 3.2 percent in the first quarter, compared with
an increase of 1.8 percent in the fourth.  Durable goods increased 8.1 percent, compared with an increase
of 13.6 percent.  Nondurable goods increased 1.0 percent, compared with an increase of 0.1 percent.
Services increased 3.1 percent, compared with an increase of 0.6 percent.

      Real nonresidential fixed investment increased 2.1 percent in the first quarter, compared with an
increase of 13.2 percent in the fourth.  Nonresidential structures decreased 0.3 percent, in contrast to an
increase of 16.7 percent.  Equipment and software increased 3.0 percent, compared with an increase of
11.8 percent.  Real residential fixed investment increased 12.6 percent, compared with an increase of
17.6 percent.

      Real exports of goods and services increased 2.9 percent in the first quarter, in contrast to a
decrease of 2.8 percent in the fourth.  Real imports of goods and services increased 5.4 percent, in
contrast to a decrease of 4.2 percent.

      Real federal government consumption expenditures and gross investment decreased 8.4 percent
in the first quarter, compared with a decrease of 14.8 percent in the fourth.  National defense decreased
11.5 percent, compared with a decrease of 22.1 percent.  Nondefense decreased 2.0 percent, in contrast
to an increase of 1.7 percent.  Real state and local government consumption expenditures and gross
investment decreased 1.2 percent, compared with a decrease of 1.5 percent.

      The change in real private inventories added 1.03 percentage points to the first-quarter change in
real GDP after subtracting 1.52 percentage points from the fourth-quarter change.  Private businesses
increased inventories $50.3 billion in the first quarter, following increases of $13.3 billion in the fourth
quarter and $60.3 billion in the third.

      Real final sales of domestic product -- GDP less change in private inventories -- increased 1.5
percent in the first quarter, compared with an increase of 1.9 percent in the fourth.

Gross domestic purchases

      Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever
produced -- increased 2.9 percent in the first quarter; it was unchanged in the fourth quarter.

Disposition of personal income

      Current-dollar personal income decreased $109.1 billion (3.2 percent) in the first quarter, in
contrast to an increase of $262.3 billion (8.1 percent) in the fourth.  The downturn in personal income
primarily reflected a sharp downturn in personal dividend income and a sharp acceleration in
contributions for government social insurance -- a subtraction in the calculation of personal income.
Fourth-quarter personal dividend income was boosted by the payment of accelerated and special
dividends. The acceleration in contributions for government social insurance in the first quarter resulted
from the expiration of the "payroll tax holiday."

      Personal current taxes increased $27.2 billion in the first quarter, compared with an increase of
$34.3 billion in the fourth.

      Disposable personal income decreased $136.3 billion (4.4 percent) in the first quarter, in contrast
to an increase of $228.0 billion (7.9 percent) in the fourth.  Real disposable personal income decreased
5.3 percent, in contrast to an increase of 6.2 percent.

      Personal outlays increased $116.3 billion (4.1 percent) in the first quarter, compared with an
increase of $97.0 billion (3.4 percent) in the fourth.  Personal saving -- disposable personal income less
personal outlays -- was $313.3 billion in the first quarter, compared with $566.0 billion in the fourth.

      The personal saving rate -- personal saving as a percentage of disposable personal income -- was
2.6 percent in the first quarter, compared with 4.7 percent in the fourth.  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
3.7 percent, or $146.1 billion, in the first quarter to a level of $16,010.2 billion.  In the fourth quarter,
current-dollar GDP increased 1.3 percent, or $53.1 billion.

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 -- May 30, 2013, at 8:30 A.M. EDT for:
                              Gross Domestic Product:  First Quarter 2013 (Second Estimate)
                              Corporate Profits:  First Quarter 2013 (Preliminary Estimate)

                                            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.
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U.S. Economy Heads Into Obama Recession With A 63% Decline in Real Gross Domestic Product (GDP) From 2011 4th Quarter 4.1% Annual Growth Rate to 2012 2nd Quarter 1.5% Annual Growth Rate!–Videos

Posted on July 27, 2012. Filed under: American History, Blogroll, Business, College, Communications, Economics, Education, Employment, Federal Government, government, government spending, history, Investments, Law, liberty, Life, Links, media, People, Philosophy, Politics, Resources, Technology, Unemployment, Video, Wisdom | Tags: , , , , , |

http://www.bea.gov/newsreleases/national/gdp/gdp_glance.htm

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Keynesian Catastrophe: Big Money, Big Government & Big Lies

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Obama’s So-Called Stimulus: Good For Government, Bad For the Economy

The Empirical Evidence Against Big Government

A Red-Ink Train Wreck: The Real Fiscal Cost of Government-Run Healthcare

 

Keynesian Economics Is Wrong: Economic Growth Causes Consumer Spending, Not the Other Way Around 

Families v. Government Programs: Which Plays a Bigger Role in Individual Achievement?

Table 1.1.1. Percent Change From Preceding Period in Real Gross Domestic Product

[Percent] Seasonally adjusted at annual rates

Last Revised on: July 27, 2012 – Next Release Date August 29, 2012

Line 2010 2011 2012
I II III IV I II III IV I II
1 Gross domestic product 2.3 2.2 2.6 2.4 0.1 2.5 1.3 4.1 2.0 1.5
2 Personal consumption expenditures 2.5 2.6 2.5 4.1 3.1 1.0 1.7 2.0 2.4 1.5
3 Goods 5.2 3.3 3.8 7.9 5.4 -1.0 1.4 5.4 4.7 0.7
4 Durable goods 5.5 10.5 7.2 15.2 7.3 -2.3 5.4 13.9 11.5 -1.0
5 Nondurable goods 5.1 0.1 2.2 4.5 4.6 -0.3 -0.4 1.8 1.6 1.5
6 Services 1.2 2.3 1.9 2.3 2.0 1.9 1.8 0.3 1.3 1.9
7 Gross private domestic investment 19.8 14.6 16.4 -5.9 -5.3 12.5 5.9 33.9 6.1 8.5
8 Fixed investment -0.9 14.5 -1.0 7.6 -1.3 12.4 15.5 10.0 9.8 6.1
9 Nonresidential 2.1 12.3 7.7 9.2 -1.3 14.5 19.0 9.5 7.5 5.3
10 Structures -23.0 13.1 -2.2 9.3 -28.2 35.2 20.7 11.5 12.9 0.9
11 Equipment and software 14.7 12.0 11.9 9.2 11.1 7.8 18.3 8.8 5.4 7.2
12 Residential -11.4 23.1 -28.6 1.5 -1.4 4.1 1.4 12.1 20.5 9.7
13 Change in private inventories
14 Net exports of goods and services
15 Exports 5.9 9.6 9.7 10.0 5.7 4.1 6.1 1.4 4.4 5.3
16 Goods 9.9 11.9 9.0 11.2 5.7 3.7 6.2 6.0 4.0 6.0
17 Services -2.2 4.5 11.1 7.4 5.8 5.1 6.1 -8.8 5.2 3.6
18 Imports 10.4 20.2 13.9 0.0 4.3 0.1 4.7 4.9 3.1 6.0
19 Goods 12.2 24.7 14.1 1.1 5.2 -0.7 2.9 6.3 2.0 6.0
20 Services 2.4 1.2 12.9 -5.0 -0.6 4.2 13.8 -1.7 9.0 5.5
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 -1.4
22 Federal 0.6 9.7 3.7 -4.1 -10.3 2.8 -4.3 -4.4 -4.2 -0.4
23 National defense -3.7 7.3 7.2 -6.1 -14.3 8.3 2.6 -10.6 -7.1 -0.4
24 Nondefense 10.1 14.6 -3.1 0.0 -1.7 -7.5 -17.4 10.2 1.8 -0.3
25 State and local -5.5 -1.4 -2.9 -4.6 -4.7 -3.2 -2.0 -0.7 -2.2 -2.1
Addendum:
26 Gross domestic product, current dollars 3.9 4.1 4.6 4.5 2.2 5.2 4.3 4.2 4.2 3.1

http://www.bea.gov/iTable/iTable.cfm?ReqID=9&step=1

Background Articles and Videos

Measuring GDP using the Income Approach and the Expenditure Approach – HD 

GDP, Nominal, Real, examples

Economic Cycles Before the Fed | Thomas E Woods, Jr.

Gold and the Good Guys | Thomas E. Woods, Jr. 

The Austrian Business Cycle Theory Explained

Table 1.1.1. Percent Change From Preceding Period in Real Gross Domestic Product

[Percent] Seasonally adjusted at annual rates

Last Revised on: July 27, 2012 – Next Release Date August 29, 2012

EMBARGOED UNTIL RELEASE AT 8:30 A.M. EDT, FRIDAY, JULY 27, 2012BEA 12-32

National Income and Product Accounts
Gross Domestic Product, 2nd quarter 2012 (advance estimate);
Revised Estimates: 2009 through First Quarter 2012
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 1.5 percent in the second quarter of 2012,
(that is, from the first quarter to the second quarter), according to the “advance” estimate released by the
Bureau of Economic Analysis. In the first quarter, real GDP increased 2.0 percent.

The Bureau emphasized that the second-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
3). The “second” estimate for the second quarter, based on more complete data, will be released on
August 29, 2012.

BOX._____
The estimates released today reflect the regular annual revision of the national income and product
accounts (NIPAs), beginning with the estimates for the first quarter of 2009. Annual revisions, which
are usually released in July, incorporate source data that are more complete, more detailed, and
otherwise more reliable than those previously available. This release includes the revised quarterly
estimates of GDP, corporate profits, and personal income and provides an overview of the effects of the
revision.

The August 2012 Survey of Current Business will contain NIPA tables and an article describing
the revisions. These NIPA tables will be available on BEA’s Web site at http://www.bea.gov by August 3,
2012.
_________

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 BEA’s Web site along with the Technical Note and Highlights
related to this release.
________________

The increase in real GDP in the second quarter primarily reflected positive contributions from
personal consumption expenditures (PCE), exports, nonresidential fixed investment, private inventory
investment, and residential fixed investment that were partly offset by a negative contribution from state
and local government spending. Imports, which are a subtraction in the calculation of GDP, increased.

The deceleration in real GDP in the second quarter primarily reflected a deceleration in PCE, an
 acceleration in imports, and decelerations in residential fixed investment and in nonresidential fixed
investment that were partly offset by an upturn in private inventory investment, a smaller decrease in
federal government spending, and an acceleration in exports.

Motor vehicle output added 0.13 percentage point to the second-quarter change in real GDP after
adding 0.72 percentage point to the first-quarter change. Final sales of computers subtracted 0.07
percentage point from the second-quarter change in real GDP after adding 0.02 percentage point to the
first-quarter change.

The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 0.7 percent in the second quarter, compared with an increase of 2.5 percent in the first.
Excluding food and energy prices, the price index for gross domestic purchases increased 1.4 percent in
the second quarter, compared with an increase of 2.4 percent in the first.

Real personal consumption expenditures increased 1.5 percent in the second quarter, compared
with an increase of 2.4 percent in the first. Durable goods decreased 1.0 percent, in contrast to an
increase of 11.5 percent. Nondurable goods increased 1.5 percent, compared with an increase of 1.6
percent. Services increased 1.9 percent, compared with an increase of 1.3.

Real nonresidential fixed investment increased 5.3 percent in the second quarter, compared with
an increase of 7.5 percent in the first. Nonresidential structures increased 0.9 percent, compared with an
increase of 12.9 percent. Equipment and software increased 7.2 percent, compared with an increase of
5.4 percent. Real residential fixed investment increased 9.7 percent, compared with an increase of 20.5
percent.

Real exports of goods and services increased 5.3 percent in the second quarter, compared with an
increase of 4.4 percent in the first. Real imports of goods and services increased 6.0 percent, compared
with an increase of 3.1 percent.

Real federal government consumption expenditures and gross investment decreased 0.4 percent
in the second quarter, compared with a decrease of 4.2 percent in the first. National defense decreased
0.4 percent, compared with a decrease of 7.1 percent. Nondefense decreased 0.3 percent, in contrast to
an increase of 1.8 percent. Real state and local government consumption expenditures and gross
investment decreased 2.1 percent, compared with a decrease of 2.2.

The change in real private inventories added 0.32 percentage point to the second-quarter change
in real GDP after subtracting 0.39 percentage point from the first-quarter change. Private businesses
increased inventories $66.3 billion in the second quarter, following increases of $56.9 billion in the first
quarter and $70.5 billion in the fourth.

Real final sales of domestic product — GDP less change in private inventories — increased 1.2
percent in the second quarter, compared with an increase of 2.4 percent in the first.

Gross domestic purchases

Real gross domestic purchases — purchases by U.S. residents of goods and services wherever
produced — increased 1.8 percent in the second quarter, the same increase as in the first quarter.

Disposition of personal income

Current-dollar personal income increased $140.5 billion (4.3 percent) in the second quarter,
compared with an increase of $199.9 billion (6.3 percent) in the first.

Personal current taxes increased $24.9 billion in the second quarter, compared with an increase
of $30.0 billion in the first.

Disposable personal income increased $115.6 billion (4.0 percent) in the second quarter,
compared with an increase of $169.9 billion (6.0 percent) in the first. Real disposable personal income
increased 3.2 percent, compared with an increase of 3.4 percent.

Personal outlays increased $59.9 billion (2.1 percent) in the second quarter, compared with an
increase of $143.1 billion (5.2 percent) in the first. Personal saving — disposable personal income less
personal outlays — was $475.3 billion in the second quarter, compared with $419.5 billion in the first.
The personal saving rate — saving as a percentage of disposable personal income — was 4.0 percent in
the second quarter, compared with 3.6 percent in the first. 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 http://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
3.1 percent, or $117.6 billion, in the second quarter to a level of $15,595.9 billion. In the first quarter,
current-dollar GDP increased 4.2 percent, or $157.3 billion.

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.”
_____________

Revision of the National Income and Product Accounts

The revised estimates, which begin with 2009, reflect the results of the annual revision of the
national income and product accounts (NIPAs). These revisions, usually made each July, incorporate
newly available and more comprehensive source data, as well as improved estimation methodologies. In
this annual revision, the notable revisions primarily reflect the incorporation of newly available and
revised source data. For example, the revised estimates of profits reflect newly available Internal
Revenue Service tabulations of tax returns for corporations for 2010 and revised tabulations for 2009.

Because of the additional data shown, tables 3, 11, and 12 are each divided into two separate
tables — 3A and 3B, 11A and 11B, and 12A and 12B. There are also a number of special tables that
compare the revised and previously published estimates for selected periods: table 1A shows the
percent change in real GDP and related measures; table 1B shows revisions to current-dollar GDP, to
national income, and to the disposition of personal income; table 2A shows contributions to the percent
change in real GDP; table 4A shows the percent change in the chain-type price indexes for GDP and
related measures; and table 12C shows revisions to corporate profits by industry.

With the release of the annual revision, statistics for selected NIPA tables will be available on
BEA’s Web site (www.bea.gov). Shortly after the GDP release, BEA will post a table on its Web site
showing the sources of major current-dollar revisions to the annual estimates for 2009–2011 for each
component of GDP, national income, and personal income. The August 2012 Survey of Current
Business will contain NIPA tables and an article describing the revisions. The August 2012 issue will
also contain an analysis of the “advance” GDP estimate for the second quarter of 2012 (“GDP and the
Economy”).

This section of the release discusses the highlights of annual revision, including the newly
incorporated source data and changes in methodology and presentation.

Summary of revisions

For this annual revision, the revisions are limited to the period from 2009 to the first quarter of
2012.

* For 2008–2011, real GDP increased at an average annual rate of 0.3 percent; in the previously
published estimates, real GDP had increased at an average annual rate of 0.4 percent. From the
fourth quarter of 2008 to the first quarter of 2012, real GDP increased at an average annual rate
of 1.5 percent; in the previously published estimates, real GDP had increased 1.4 percent.

* The percent change in real GDP was revised up 0.4 percentage point for 2009, was revised down
0.6 percentage point for 2010, and was revised up 0.1 percentage point for 2011.

* The revisions to the annual estimates for 2009–2011 reflect partly offsetting revisions to the
quarters within the year. For example, for 2009, the annual rate of change in GDP was revised
up 1.4 percentage points for the first quarter, was revised up 0.4 percentage point for the second
quarter, and was revised up 0.2 percentage point for the fourth quarter, while the growth rate for
the third quarter was revised down 0.3 percentage point. For 2010, the annual rate of change in
GDP was revised down 1.6 percentage points for both the first and second quarters, while the
growth rates for the third and fourth quarters were each revised up 0.1 percentage point. For
2011, the annual rate of change in GDP was revised up 1.2 percentage points for the second
quarter and was revised up 1.1 percentage points for the fourth quarter, while the growth rates for
the first and third quarters were revised down 0.3 percentage point and 0.5 percentage point,
respectively.

* For the 13 quarters from the first quarter of 2009 to the first quarter of 2012, the average revision
(without regard to sign) was 0.7 percentage point. The revisions did not change the direction of
change in real GDP (increase or decrease) for any quarter.

* For 2008–2011, the average annual rate of growth of real disposable personal income was
revised down 0.1 percentage point, from 0.2 percent to 0.1 percent.

* From the fourth quarter of 2008 to the first quarter of 2012, the average annual rate of increase in
the price index for gross domestic purchases was 1.6 percent, the same rate of increase as in the
previously published estimates. The average annual rate of increase in the price index for
personal consumption expenditures (PCE) was 1.8 percent; in the previously published
estimates, the price index for PCE had increased 1.9 percent. The average annual rate of
increase in the “core” PCE price index (which excludes food and energy) was 1.5 percent; in the
previously published estimates, the “core” PCE price index had increased 1.6 percent.

* The percent change in real gross domestic income (GDI) was revised up 0.1 percentage point for
2009, was revised down 0.5 percentage point for 2010, and was revised down 0.2 percentage
point for 2011.

* National income was revised down for all 3 years: 0.1 percent for 2009, 0.2 percent for 2010,
and 0.5 percent for 2011.

* Corporate profits was revised down for all 3 years: 1.4 percent for 2009, 5.4 percent for 2010,
and 6.0 percent for 2011.

Revisions to the 2009-2011 estimates

The percent change from the preceding year in real GDP was revised up from a decrease of 3.5
percent to a decrease of 3.1 percent for 2009, was revised down from an increase of 3.0 percent to an
increase of 2.4 percent for 2010, and was revised up from an increase of 1.7 percent to an increase of 1.8
percent for 2011.

For 2009, the largest contributors to the revision to the change in real GDP were upward
revisions to state and local government spending and to inventory investment. For 2010, the largest
contributors to the revision were downward revisions to nonresidential fixed investment, to PCE, and to
inventory investment. For 2011, the largest contributors to the revision were upward revisions to PCE
and to inventory investment; these revisions were partly offset by downward revisions to state and local
government spending, to federal government spending, and to nonresidential fixed investment.

The percent change from fourth quarter to fourth quarter in real GDP was revised up from a
decrease of 0.5 percent to a decrease of 0.1 percent during 2009, was revised down from an increase of
3.1 percent to an increase of 2.4 percent during 2010, and was revised up from an increase of 1.6 percent
to an increase of 2.0 percent during 2011.

For the period of contraction from the fourth quarter of 2007 to the second quarter of 2009, real
GDP decreased at an average annual rate of 3.2 percent; in the previously published estimates, it had
decreased 3.5 percent. The cumulative decrease in real GDP (not at an annual rate) was 4.7 percent; in
the previously published estimates, the cumulative decrease was 5.1 percent.

For the period of expansion from the second quarter of 2009 to the first quarter of 2012, real
GDP increased at an average annual rate of 2.3 percent; in the previously published estimates, it had
increased 2.4 percent.

The percent change from the preceding year in real gross domestic income (GDI) was revised up
from a decrease of 4.0 percent to a decrease of 3.9 percent for 2009, was revised down from an increase
of 3.6 percent to an increase of 3.1 percent for 2010, and was revised down from an increase of 2.0
percent to an increase of 1.8 percent for 2011.

The percent change from the preceding year in the price index for gross domestic purchases was
revised down from a decrease of 0.1 percent to a decrease of 0.2 percent for 2009, was revised up from
an increase of 1.5 percent to an increase of 1.6 percent for 2010, and was unrevised at 2.5 percent for
2011. For the corresponding quarters, the largest downward revision was 0.6 percentage point for the
first quarter of 2011; the largest upward revision was 0.4 percentage point (for both the third and fourth
quarters of 2010).

Current-dollar GDP was revised up $34.7 billion, or 0.2 percent, for 2009; was revised down
$27.6 billion, or 0.2 percent, for 2010; and was revised down $18.3 billion, or 0.1 percent, for 2011.
The percent change from the preceding year was revised up from a decrease of 2.5 percent to a decrease
of 2.2 percent for 2009, was revised down from an increase of 4.2 percent to an increase of 3.8 percent
for 2010, and was revised up from an increase of 3.9 percent to an increase of 4.0 percent for 2011.
Current-dollar gross national product (GNP) (GDP plus net receipts of income from the rest of the
world) was revised up $26.0 billion, or 0.2 percent, for 2009; was revised down $7.7 billion, or 0.1
percent, for 2010; and was revised down $12.0 billion, or 0.1 percent, for 2011. Net receipts of income
from the rest of the world was revised down $8.8 billion for 2009, was revised up $19.9 billion for 2010,
and was revised up $6.4 billion for 2011. The revisions to net receipts of income — which affect GNP,
national income, corporate profits, net interest and miscellaneous payments, and personal income
receipts on assets — resulted from the revisions to BEA’s international transactions accounts (ITAs) that
were released in June. (An article describing the revisions to the ITAs was published in the July 2012
issue of the Survey of Current Business.)

National income was revised down for all 3 years: $15.0 billion, or 0.1 percent, for 2009; $28.7
billion, or 0.2 percent, for 2010; and $62.3 billion, or 0.5 percent, for 2011. For 2009, downward
revisions to corporate profits, to net interest, and to rental income of persons were partly offset by an
upward revision to nonfarm proprietors’ income. For 2010, a downward revision to corporate profits
was partly offset by an upward revision to nonfarm proprietors’ income. For 2011, a downward revision
to corporate profits was partly offset by upward revisions to nonfarm proprietors’ income and to
supplements to wages and salaries.

Corporate profits from current production — profits before tax with inventory valuation and
capital consumption adjustments — was revised down for all 3 years: $19.7 billion, or 1.4 percent, for
2009; $97.7 billion, or 5.4 percent, for 2010; and $115.8 billion, or 6.0 percent, for 2011. For 2009,
downward revisions to profits of domestic financial corporations and to profits from the rest of the world
were partly offset by an upward revision to profits of domestic nonfinancial corporations. For 2010 and
2011, downward revisions to profits of domestic financial and nonfinancial corporations were partly
offset by an upward revision to profits from the rest of the world.

Profits before tax was revised down for all 3 years: $15.2 billion for 2009, $3.2 billion for 2010,
and $42.2 billion for 2011. The before-tax measure of profits does not reflect, as does profits from
current production, the capital consumption and inventory valuation adjustments. These adjustments
convert depreciation of fixed assets and inventory withdrawals reported on a tax-return, historical-cost
basis to the current-cost measures used in the national income and product accounts. The capital
consumption adjustment was revised down for all 3 years: $7.0 billion for 2009, $94.9 billion for 2010,
and $71.2 billion for 2011. The inventory valuation adjustment was revised up $2.6 billion for 2009,
was revised up $0.4 billion for 2010, and was revised down $2.5 billion for 2011.

Personal income was revised down for all 3 years: $63.2 billion, or 0.5 percent, for 2009; $51.6
billion, or 0.4 percent, for 2010; and $43.9 billion, or 0.3 percent, for 2011. For 2009, downward
revisions to personal dividend income, to rental income of persons, and to personal interest income were
partly offset by an upward revision to nonfarm proprietors’ income. For 2010, a downward revision to
personal dividend income was partly offset by upward revisions to nonfarm proprietors’ income and to
personal interest income. For 2011, downward revisions to personal dividend income, to government
social benefits to persons, and to farm proprietors’ income were partly offset by upward revisions to
nonfarm proprietors’ income, to supplements to wages and salaries, and to personal interest income.

Disposable personal income (DPI) (personal income less personal current taxes) was revised
down for all 3 years: $66.4 billion, or 0.6 percent, for 2009; $52.6 billion, or 0.5 percent, for 2010; and
$44.2 billion, or 0.4 percent, for 2011. Personal current taxes was revised up for all 3 years: $3.2 billion
for 2009, $0.9 billion for 2010, and $0.3 billion for 2011. The percent change from the preceding year
in real DPI was revised down from a decrease of 2.3 percent to a decrease of 2.8 percent for 2009, was
unrevised at 1.8 percent for 2010, and was revised up from an increase of 1.2 percent to an increase of
1.3 percent for 2011.

Personal outlays — PCE, personal interest payments, and personal current transfer payments —
was revised down $22.0 billion for 2009, was revised down $26.5 billion for 2010, and was revised up
 $4.8 billion for 2011. For 2009 and 2010, downward revisions to PCE accounted for most of the
 revisions to personal outlays. For 2011, upward revisions to personal interest payments and to PCE
were partly offset by a downward revision to personal current transfer payments to government. The
personal saving rate (personal saving as a percentage of DPI) was revised down for all 3 years: from 5.1
percent to 4.7 percent for 2009, from 5.3 percent to 5.1 percent for 2010, and from 4.6 percent to 4.2
percent for 2011.

The statistical discrepancy is current-dollar GDP less current-dollar gross domestic income
(GDI). It arises because most components of GDP and of GDI are estimated independently. GDP
measures final expenditures — the sum of consumer spending, private investment, net exports, and
government spending. GDI measures the incomes earned in the production of GDP. In concept, GDP is
equal to GDI. In practice, they differ because they are estimated using different source data and
different methods.

As a result of the annual revision, the statistical discrepancy as a percentage of GDP was revised
up for all 3 years: from 0.6 percent to 0.8 percent for 2009, from less than 0.1 percent to 0.2 percent for
2010, and from a negative 0.2 percent to a positive 0.2 percent for 2011. For 2009, the revision to the
discrepancy reflected an upward revision to GDP and a downward revision to GDI. For 2010 and 2011,
the revisions to the discrepancy reflected downward revisions to GDI that were larger than the
downward revisions to GDP.

New source data

The annual revision incorporated data from the following major federal statistical sources:
Census Bureau annual survey of manufactures for 2009 (revised) and 2010 (preliminary); Census
Bureau annual surveys of merchant wholesale trade and of retail trade for 2009 (revised) and for 2010
(preliminary); Census Bureau revised monthly indicators of manufactures, of merchant wholesale trade,
and of retail trade for 2009–2011; Census Bureau annual surveys of services for 2009 (revised), 2010
(revised), and 2011 (preliminary), and of state and local government finances for fiscal years 2008
(revised), 2009 (revised), and 2010 (preliminary); Census Bureau monthly survey of construction
spending (value put in place) for 2009–2011 (revised); Census Bureau quarterly services survey for
2009–2011 (revised); Census Bureau current population survey/housing vacancy survey for 2011;
federal government budget data for fiscal years 2011 and 2012; Internal Revenue Service tabulations of
tax returns for corporations for 2009 (revised) and 2010 (preliminary) and for sole proprietorships and
partnerships for 2010; Bureau of Labor Statistics quarterly census of employment and wages for 2009–
2011 (revised); Department of Agriculture farm statistics for 2009–2011 (revised); and BEA’s ITAs for
2009–2011 (revised).

Changes in methodology and presentation

The annual revision also incorporated improvements to estimating methodologies, including the
following:

* Beginning with the estimates for 2010, data from the Census Bureau’s expanded service annual
survey (SAS) are incorporated into the annual estimates of PCE categories for ground
transportation for intercity buses, taxicabs, private urban transit systems, school bus
transportation, and “other” road transportation. Newly available SAS data are also incorporated
into the PCE estimates of water transportation; both ground transportation and water
transportation are included in the PCE category public transportation. In addition, newly
available SAS data are incorporated into the PCE estimates of commercial and vocational
schools and into the PCE estimates of water supply and sanitation services. Similarly, beginning
with the estimates for the first quarter of 2011, data from the Census Bureau’s expanded
quarterly services survey (QSS) are incorporated into the quarterly estimates of most of these
same PCE categories. As a result, the percentage of quarterly PCE services that are based on the
QSS has increased to 42 percent.

* Beginning with the estimates for 2010, retail motor vehicle inventory investment is derived using
a weighted average of private industry data on motor vehicle unit inventories and of inventory
data from the Census Bureau’s retail trade surveys. This methodology is used for both the
annual inventory investment estimates and the current quarterly extrapolations of inventory
investment. Prior to this methodology change, estimates of annual inventory investment were
based solely on retail trade inventory data from the Census Bureau, and the current quarterly
extrapolations were based solely on the unit inventory data. This new approach takes into
account differences in the scope and coverage of these two data sources and makes the annual
and current quarterly methodologies more consistent and should result in smaller revisions
during annual revisions.

* Beginning with the estimates for the second quarter of 2012, data for the “preliminary”
composite refiner acquisition cost of crude oil from the Energy Information Administration are
used in place of the producer price index for crude petroleum as the indicator for the estimates of
the refiner crude acquisition cost, which is used in the estimation of a number of important series
of private inventory investment and their corresponding inventory valuation adjustments.

* Beginning with the estimates for the first quarter of 2009, revised seasonally adjusted foreign
trade prices are incorporated on a “best-level” basis into BEA’s chained-dollar estimates of
exports and imports. The revised prices reflect BEA’s work with the Census Bureau’s Foreign
Trade Division to develop more consistent measures of chained-dollar exports and imports.

* A new group of tables is introduced on BEA’s Web site to show GDP, GDI, and other major
NIPA aggregates (including GNP and various command-basis measures) side-by-side. Most of
the measures in these tables are already available in other NIPA tables. The new tables are
intended to facilitate comparison of these major aggregates.

* * *

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 http://www.bea.gov. By visiting the
site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements.

* * *

Next release — August 29, 2012, at 8:30 A.M. EDT for:
Gross Domestic Product: Second Quarter 2012 (Second Estimate)
Corporate Profits: Second Quarter 2012 (Preliminary Estimate)

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………………… .2 .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 2008.

http://bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm

Table 1.1.1. Percent Change From Preceding Period in Real Gross Domestic Product

[Percent] Seasonally adjusted at annual rates

Last Revised on: July 27, 2012 – Next Release Date August 29, 2012

Line 2010 2011 2012
I II III IV I II III IV I II
1 Gross domestic product 2.3 2.2 2.6 2.4 0.1 2.5 1.3 4.1 2.0 1.5
2 Personal consumption expenditures 2.5 2.6 2.5 4.1 3.1 1.0 1.7 2.0 2.4 1.5
3 Goods 5.2 3.3 3.8 7.9 5.4 -1.0 1.4 5.4 4.7 0.7
4 Durable goods 5.5 10.5 7.2 15.2 7.3 -2.3 5.4 13.9 11.5 -1.0
5 Nondurable goods 5.1 0.1 2.2 4.5 4.6 -0.3 -0.4 1.8 1.6 1.5
6 Services 1.2 2.3 1.9 2.3 2.0 1.9 1.8 0.3 1.3 1.9
7 Gross private domestic investment 19.8 14.6 16.4 -5.9 -5.3 12.5 5.9 33.9 6.1 8.5
8 Fixed investment -0.9 14.5 -1.0 7.6 -1.3 12.4 15.5 10.0 9.8 6.1
9 Nonresidential 2.1 12.3 7.7 9.2 -1.3 14.5 19.0 9.5 7.5 5.3
10 Structures -23.0 13.1 -2.2 9.3 -28.2 35.2 20.7 11.5 12.9 0.9
11 Equipment and software 14.7 12.0 11.9 9.2 11.1 7.8 18.3 8.8 5.4 7.2
12 Residential -11.4 23.1 -28.6 1.5 -1.4 4.1 1.4 12.1 20.5 9.7
13 Change in private inventories
14 Net exports of goods and services
15 Exports 5.9 9.6 9.7 10.0 5.7 4.1 6.1 1.4 4.4 5.3
16 Goods 9.9 11.9 9.0 11.2 5.7 3.7 6.2 6.0 4.0 6.0
17 Services -2.2 4.5 11.1 7.4 5.8 5.1 6.1 -8.8 5.2 3.6
18 Imports 10.4 20.2 13.9 0.0 4.3 0.1 4.7 4.9 3.1 6.0
19 Goods 12.2 24.7 14.1 1.1 5.2 -0.7 2.9 6.3 2.0 6.0
20 Services 2.4 1.2 12.9 -5.0 -0.6 4.2 13.8 -1.7 9.0 5.5
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 -1.4
22 Federal 0.6 9.7 3.7 -4.1 -10.3 2.8 -4.3 -4.4 -4.2 -0.4
23 National defense -3.7 7.3 7.2 -6.1 -14.3 8.3 2.6 -10.6 -7.1 -0.4
24 Nondefense 10.1 14.6 -3.1 0.0 -1.7 -7.5 -17.4 10.2 1.8 -0.3
25 State and local -5.5 -1.4 -2.9 -4.6 -4.7 -3.2 -2.0 -0.7 -2.2 -2.1
Addendum:
26 Gross domestic product, current dollars 3.9 4.1 4.6 4.5 2.2 5.2 4.3 4.2 4.2 3.1

http://bea.gov/iTable/iTable.cfm?ReqID=9&step=1

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U.S. Real Gross Domestic Product (GDP) Declined From 3% in Fourth Quarter 2011 to 1.9% in First Quarter of 2011–U.S. GDP Peaked Heading Toward Recession in Second Half of 2012–Diving Off The Fiscal Cliff–Videos

Posted on May 31, 2012. Filed under: American History, Blogroll, College, Communications, Economics, Education, Employment, Federal Government, Federal Government Budget, Fiscal Policy, Food, government spending, history, Inflation, Language, Law, liberty, Life, Links, Macroeconomics, media, Monetary Policy, People, Politics, Raves, Taxes, Video | Tags: , , , , , , , |

Current Numbers:
  • 1st quarter 2012: 1.9 percent
  • 4th quarter 2011: 3.0 percent
Quarterly data: 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 1.9 percent in the first quarter of 2012 (that is, from the fourth quarter to the first quarter), according to the “second” estimate released by the Bureau of Economic Analysis. In the fourth quarter of 2011, real GDP increased 3.0 percent.

Real gross domestic product (GDP) rose 1.9 percent in the first quarter of 2012 after rising 3.0 percent

in the fourth quarter, according to the second estimate released today by the Bureau of Economic Analysis. The

first-quarter growth rate was 0.3 percentage point less than the “advance” estimate released in April.

Over the past 4 quarters, real GDP grew 2.0 percent.

First-quarter highlights

An acceleration in consumer spending in the first quarter was more than offset by a slowdown in inventory investment.

Consumer spending was strong in the first quarter, rising 2.7 percent after rising 2.1 percent in the fourth quarter. The

firstquarter increase was the largest since the fourth quarter of 2010. Spending on services and nondurable goods accelerated,

more than offsetting a slowdown in spending on durable goods (mainly motor vehicles and parts).

The slowdown in inventory investment reflected a sharp downturn in inventory investment by nondurablegoods

wholesalers and manufacturers. A slowdown in business investment, mainly in industrial equipment and

in computers and software, also contributed to the slowdown in economic growth.

Revisions to GDP The downward revision of real GDP growth for the first quarter was largely accounted for by a downward

revision to inventory investment; manufacturing, wholesale, and retail inventories were all revised down. In addition,

imports was revised up. Partly offsetting these revisions, business investment and exports were revised up.

http://www.bea.gov/newsreleases/national/gdp/gdphighlights.pdf

Economy tanking under Obama

Economy slides as Obama campaigns

World Business and Economy Look (US, UK Europe) – Economies slow down CNN (31-05-2012)

U.S. Fiscal Cliff – Martin Feldstein

CNBC:Global Recession? Marc Faber: 100%

Background Articles and Videos

U.S. Recession a Possibility in 2012, Shilling Says

2012 recession coming to the world

Roubini Says Stimulus Will Sap Second-Half U.S. Growth

Sept. 3 (Bloomberg) — Nouriel Roubini, chairman and co-founder of Roubini Global Economics LLC, talks about the outlook for the global economy and the possible impact of a double-dip recession or an increase in risk aversion on gold and currencies. He talks with Francine Lacqua in Cernobbio, Italy, on Bloomberg Television’s “Countdown.” (Source: Bloomberg)

Glenn Beck Interviews Ron Paul About U.S Recession (2/2/2012) 

U.S. recession still possible in 2012, says Shiller

Crandall: Europe’s banks a worry

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