According to the BEA’s press release today:
Real gross domestic product — the output of goods and services produced by labor and propertylocated in the United States — decreased at an annual rate of 2.9 percent in the first quarter of 2014 according to the “third” estimate released by the Bureau of Economic Analysis. In the fourth quarter of 2013, real GDP increased 2.6 percent.
Here’s the year-over-year change:
The last time the drop was this much was during the 1st Q of 2009 when GDP dropped 5.4 percent. The worst YOY change during that recession was during the 4th Q of 2008 when GDP dropped 8.3 percent. Keep in mind that these numbers include government spending.
The numbers keep getting worse, but the mainstream economists remain on message and are continuing to blame “bad weather” as the cause of the slide. Looking at the last 25 years of GDP results, why is it that no other non-recessionary quarter saw a 2.9 percent drop due to weather? Was the winter of 2014 the worst winter in 25 years? So bad, in fact, that it succeeded in driving down economic growth by almost 3 percent in a non-recessionary quarter while the 25 previous winters failed? Or perhaps all the bad winters just happened to occur during recessions. That seems a bit unlikely.
But nevermind that. Reports Forbes:
In an interview following the release Stephen Auth, Chief Investment Officer at Federated Investors, called the revision “pretty incredible” but says that underlying trends have shown improvement that has simply been “masked” by the weather. He expects second quarter GDP growth to come in north of 4% and continual market gains.