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Wednesday, April 29, 2015

US Economy Likely Mired in Recession Now

Today's government report of First Quarter GDP growth should be taken with a large helping of salt. That's because the government has a horrible record at tracking the economy.

For instance, in 2008, with the economy a half-year into the worst recession since the Great Depression, the government reported the economy was growing at a +0.6% rate. After numerous revisions over the next 64 months, they finally decided that the economy was declining at a -2.7% rate!

That's why the government's report that the economy grew in the first quarter could just as easily be revised to a huge decline over the next 64 months. As it is, the government tells us that GDP was growing at a +0.25% rate. Garbage in, garbage out.