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Gross domestic product shows weak growth in second quarter

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(Read caption) This chart shows real gross domestic product from 2001 through the second quarter of this year. GDP is close to the high level seen in mid-2008.

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Today, the Bureau of Economic Analysis (BEA) released their first "estimate" of the Q2 2011 GDP report showing that the economy continued to weakly expand with real GDP increasing at an annualized rate of 1.3% from Q1 2011.

On a year-over-year basis real GDP increased 1.62% while the quarter-to-quarter non-annualized percent change was 0.32%.

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Today's release also includes a regular annual revision to past years (three years) results bringing, in some cases, dramatically different assessment of the country's economic performance.

For example, Q1 2011 GDP was revised down from the reported 1.9% to a mere 0.4% while Q4 2010 GDP was revised down from 3.1% to 2.3%.

Q4 2009 GDP was revised down from the originally reported 5.0% to 3.8% while Q4 2008 was revised down from the reported -6.8% to the stunning -8.9%.
Note that the BEA has finally taken down their estimates for Q2 2010 (as I had predicted) residential fixed investment from the original lofty level of 25.7% to the still poorly estimated 22.8%... still to high.... look for that figure to be revised down further.

The latest quarterly results revealed an notable 4.4% decline in durable goods from Q1 2011 with personal consumption expenditures registering the weakest showing in eight quarters at 0.1% over the same period.

Government spending declined notably with the non-defense spending declining 7.3% from Q1 2011 while state and local spending declining 3.4%.

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