Tuesday, March 31, 2015

Demographics and GDP: 2% is the new 4% via Calculated Risk

Note: This is a repeat of a post I wrote early this year. Based on some recent comments I've seen, I think this is worth repeating.

For amusement, I checked out the WSJ opinion page comments on the Q4 GDP report. As usual, the WSJ opinion is pure politics - but it does bring up an excellent point (that the WSJ conveniently ignores).

First, from the WSJ opinion page:
The fourth quarter report means that growth for all of 2014 clocked in at 2.4%, which is the best since 2.5% in 2010. It also means another year, an astonishing ninth in a row, in which the economy did not grow by 3%.
This period of low growth isn't "astonishing". First, usually following a recession, there is a brief period of above average growth - but not this time due to the financial crisis and need for households to deleverage. So we didn't see a strong bounce back (sluggish growth was predicted on the blog for the first years of the recovery).

Read more...Calculated Risk: Demographics and GDP: 2% is the new 4%

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