Government number crunchers always provide fascinating reading.
Today, for example, the Commerce Department said the GDP from 1998-2007 was on average actually 2.7 percent, or $301.5 billion, higher that we thought.
Higher, that is, “if research and development (R&D) spending was treated as investment in the U.S. national income and product accounts,” according to the the Bureau of Economic Analysis.
So, does that mean if we count R&D spending the recession really wasn’t all that bad?
The Commerce Department released its third estimate of first quarter GDP and once again it’s lower. Apparently, consumers didn’t spend as much in the quarter as previously thought and the GDP rose 2.7 percent, instead of 3 percent.
We all wish the economy was recovering faster, but at least it’s growing and continued growth looks likely.
On Thursday, government reports showed that businesses have been spending more on machinery, computers, metals and other goods in the second quarter. That is a strong indicator that businesses are positive about the coming months, will boost production and may finally start hiring later in the year.
Another good sign: The average interest rate for a 30-year fixed-rate mortgage fell to the lowest point on record — 4.69 percent. That hopefully will boost home sales, which dropped in May when the end of the federal tax break for homebuyers.
However, interest rates have been low for months and the housing market hasn’t really responded.
And this week brought the latest word from the big brains at the Federal Reserve. And that word was “fragile.”
The Fed expects the economy to keep growing, but the board’s mood was less upbeat than before. Its outlook is tempered by a sluggish domestic labor market and concern about Europe’s financial crisis.
Whew! What a week. I need a vacation.
Word from the Commerce Department today is that the economy didn’t grow quite as fast in the first quarter as originally estimated. But that’s no reason to panic. The key word here is “grow.” The economy continues to recover, albeit slowly.
Several bits of good news can be found in the news release from the Bureau of Economic Analysis.
— Automobile manufacturing and computer sales both were up from the fourth quarter.
— Consumer spending rose 3.5 percent, slightly less than originally estimated, but up from 1.6 percent in the 4Q and the strongest showing in three years.
— Corporate America is still making money. Corporate profits increased $81.4 billion, compared to a 4Q increase of $108.7 billion. Still a tidy increase, any way you cut it.
Read the full BEA press release here.