Despite all the economic doom and gloom, weâ€™re actually not in a recession. Turns out, the economy grew 0.6% last quarter. A recession is when the gross domestic product (GDP) goes into the red for two consecutive quarters.
Of course, 0.6% growth is only good news when youâ€™re expecting negative growth. The economyâ€™s growth in the final quarter of last year was also just 0.6% which means, while weâ€™re not in a recession, our economy is stagnating. Our economy is struggling with the bad housing market (the number of foreclosures increased for the seventh consecutive quarter) and slowing consumer spending due to declining consumer confidence (which is at a five year low).
Given the grim numbers, the fact that we arenâ€™t actually in a recession is positive news and makes it more likely that weâ€™ll get through this slump faster and with less overall pain than some have predicted. The last two quarters were filled with negativity and bad economic news yet the GDP still managed to eke into the black. My guess now is that, by the time the next president takes office, our economy will be on the rebound but economic conditions will still be the central issue of this campaign.
This entry was posted on Wednesday, April 30th, 2008 and is filed under Economy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.