Friday, October 28, 2011
Not Cured, but Getting Healthier
The new GDP numbers from last quarter have just been released. As talked about in the article "U.S. Economy Picks Up Pace, Averting Stall," the details of these new numbers can be seen. The real GDP increased from a 1.3% increase to a 2.5% increase in the last quarter, that's a 1.2% increase for all you folks that are a little slow at math. This 1.2% growth was the largest in the past year. The rise in GDP can be credited to consumer spending and business investment. According to the article, consumers spent more on healthcare, and businesses invested in software and vehicles. Even though this growth in GDP is definitely a great thing for the economy, we are still not in the clear. A economy is considered healthy when economic growth is 3% for the year, meaning all four quarters average out to 3%. Sitting at 2.5% right now, our economy is not considered healthy. Hey, at least we are heading in the right direction! But, to recover from the recent recession, the GDP needs to keep increasing, even at higher rates, in order to lower unemployment by a significant amount and get our economy healthy. This task is a difficult one to say the least. According to the article, economist don't expect growth to rise in the next few quarters, but as the wise and knowingly Mr. Ostroff said, "Economists can't predict the future, they can only analyze the past."