The Progressive Propaganda Media is celebrating. They are declaring this the greatest economic comeback ever. The US GDP grew at 5.7% in the 4th Quarter. Now I ask myself, where is this growth? I see people out of work, wages frozen and businesses struggling. However, the government claims the economy is growing. Can someone explain to me how this is possible?
WASHINGTON (Reuters) – The economy grew at a faster-than-expected 5.7 percent pace in the fourth quarter, the quickest in more than six years, as businesses made less-aggressive cuts to inventories and stepped up spending.
The Commerce Department said on Friday its first estimate put fourth-quarter gross domestic product growth at its fastest pace since the third quarter of 2003. The economy expanded at a 2.2 percent annual rate in the third quarter.
Analysts polled by Reuters had forecast GDP, which measures total goods and services output within U.S. borders, growing at a 4.6 percent rate in October-December period.
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I really don’t get this. I don’t see any growth when I go out. In fact I see empty stores and people watching what they buy. The answer for this high number could be this statement.
Business inventories fell only $33.5 billion in fourth quarter after dropping $139.2 billion in the July-September period. The change in inventories alone added 3.39 percentage points to GDP in the last quarter. This was the biggest percentage contribution since the fourth quarter of 1987.
So it’s not real growth then producing this number, it was a slowdown in the reduction of inventories that caused this number to be high. In other words, this is not a sustainable number and the revision will reduce it. It doesn’t matter to the Media, they will trumpet this as a great economic boom and credit Obama. As much as they want to celebrate, fact is wages rose very slightly for the average worker.
Workers’ compensation has been battered by the country’s deep recession as a loss of 7.2 million jobs over the past two years has depressed wage gains. A separate report from the Labor Department earlier this month showed that nonsupervisory workers’ inflation-adjusted weekly earnings fell by 1.6 percent last year, the sharpest drop since 1990.
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This continues a decade long trend of stagnating wages. This is due to America’s outdated economic structure that can’t compete in the global economy. Until we change our tax laws to incentivize business to invest here, wages will continue to decline. America needs to get its house in order. If not, we will become a has been power.
Tags: GDP
