Friday, July 30, 2010

Near-term GDP is still fine

Despite all of the chatter about an allegedly imminent double-dip recession, GDP is holding up fine. Yes, GDP growth is currently semi-anemic and maybe too slow to encourage rapid job growth, but that is fine for this stage of the recovery. Today's GDP report showed that Q2 real GDP growth came in at an annualized rate of 2.4%. I hate to break it to the cynics and bears, but anything above zero really is fine and anything above 1% or so is perfectly acceptable. According to Macroeconomic Advisors, LLC, real annualized growth of GDP for Q3 is tracking at 2.8%. Not bad. It is still too soon to talk about anything other than guesstimates for Q4 and beyond, but the actual evidence is only for a slowing, not renewed recession.

-- Jack Krupansky

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