GDP increased at an annual rate of 4.2% for Q1 2004

[xxxxxJohnGaltxxxxx]

GROSS DOMESTIC PRODUCT: FIRST QUARTER 2004 (ADVANCE)

Real gross domestic product -- the output of goods and services produced by labor and property
located in the United States -- increased at an annual rate of 4.2 percent in the first quarter of 2004,
according to advance estimates released by the Bureau of Economic Analysis. In the fourth quarter, real
GDP increased 4.1 percent.

The Bureau emphasized that the first-quarter "advance" estimates are based on source data that are
incomplete or subject to further revision by the source agency (see the box on page 4). The first-quarter
"preliminary" estimates, based on more comprehensive data, will be released on May 27, 2004.

The major contributors to the increase in real GDP in the first quarter were personal consumption
expenditures (PCE), equipment and software, government spending, exports, and private inventory
investment. Imports, which are a subtraction in the calculation of GDP, increased.

The slight acceleration in real GDP growth in the first quarter primarily reflected a deceleration in
imports, an upturn in government spending, and an acceleration in PCE that were largely offset by
decelerations in exports, in inventory investment, and in residential fixed investment.

The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 3.2 percent in the first quarter, compared with an increase of 1.3 percent in the fourth.
Excluding food and energy prices, the price index for gross domestic purchases increased 2.3 percent in
the first quarter, compared with an increase of 1.5 percent in the fourth. About 0.3 percentage point of
the first-quarter increase in the index was accounted for by the pay raise for federal civilian and military
personnel, which is treated as an increase in the price index of employee services purchased by the
federal government.

 

[CADsortaGUY]

Originally posted by: xxxxxJohnGaltxxxxx
GROSS DOMESTIC PRODUCT: FIRST QUARTER 2004 (ADVANCE)

Real gross domestic product -- the output of goods and services produced by labor and property
located in the United States -- increased at an annual rate of 4.2 percent in the first quarter of 2004,
according to advance estimates released by the Bureau of Economic Analysis. In the fourth quarter, real
GDP increased 4.1 percent.

The Bureau emphasized that the first-quarter "advance" estimates are based on source data that are
incomplete or subject to further revision by the source agency (see the box on page 4). The first-quarter
"preliminary" estimates, based on more comprehensive data, will be released on May 27, 2004.

The major contributors to the increase in real GDP in the first quarter were personal consumption
expenditures (PCE), equipment and software, government spending, exports, and private inventory
investment. Imports, which are a subtraction in the calculation of GDP, increased.

The slight acceleration in real GDP growth in the first quarter primarily reflected a deceleration in
imports, an upturn in government spending, and an acceleration in PCE that were largely offset by
decelerations in exports, in inventory investment, and in residential fixed investment.

The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 3.2 percent in the first quarter, compared with an increase of 1.3 percent in the fourth.
Excluding food and energy prices, the price index for gross domestic purchases increased 2.3 percent in
the first quarter, compared with an increase of 1.5 percent in the fourth. About 0.3 percentage point of
the first-quarter increase in the index was accounted for by the pay raise for federal civilian and military
personnel, which is treated as an increase in the price index of employee services purchased by the
federal government.

This is good news Nice strong growth.

CkG

 

[leeboy]

I was not aware that the GDP included: government spending. What KIND of government spending does that include for the lay person? Not being a smart ass, but I am sure someone who posts here is a GDP freakmiester and would know the answer. Would the contracts we have paid to all the NON-military personnel working in Iraq right now be part of the GDP number then? Just asking?

 

[xxxxxJohnGaltxxxxx]

Originally posted by: leeboy
I was not aware that the GDP included: government spending. What KIND of government spending does that include for the lay person? Not being a smart ass, but I am sure someone who posts here is a GDP freakmiester and would know the answer. Would the contracts we have paid to all the NON-military personnel working in Iraq right now be part of the GDP number then? Just asking?

I hate to give you the typical 'we can neither accepted, nor reject...' answer, but it depends

This is a very difficult question--because it deals with the classification of government expenditures as a component of GDP--and deals with services performed abroad. With regards to your specific question, contracts paid to non-military personnel (i.e. Brown and Root/Haliburton in Iraq), it would show up in GDP, but not necessarily as a component of government expenditures, as it may well be classified as an export of services, thus still in the basic GDP formula, but as an 'X' and not a 'G' But with regards for services performed in Iraq, for the most part, they are in GDP as an export of services , not government expenditures, per se.

[edit] removed the part about unilateral transfers (gifts), as that is not applicable to the question raised above...and Brown and Root services are not considered a 'gift' in the traditional sense of the word

 

[freegeeks]

that is an impressive growth

 

[xxxxxJohnGaltxxxxx]

Originally posted by: freegeeks
that is an impressive growth

A graphic representation

 

[smashp]

as long As we can Hold Infalation pressures at bay and not raise rates too soon, I do see a period on constant growth ahead.

IMHO, The Last 4 years of corporations becoming more efficient and Trimming Fat Should help the Growth more than anything.

I think the Recession was a needed event to force companies to focus on their core business operations and control rising costs.

This Should help produce more jobs in the Future, the down side is many jobs were lost in the Trimming.

Thats my opinion on the Macro US econ scale.

It still sucks for someone who loses his job though in thoses cuts. But hey its the nature of the beast.

 

[conjur]

http://www.nytimes.com/2004/04/30/business/30econ.html?ex=1083902400&en=bb147e6069623afc&ei=5062&partner=GOOGLE

The American economy grew at a vigorous annual rate of 4.2 percent in the first quarter, with military spending making a significant contribution to economic growth for the first time since the early days of the war in Iraq.

Consumers provided most of the lift, the Bureau of Economic Analysis reported yesterday. Business investment was also strong, adding more to the growth rate than the military outlays. Without the war spending, however, the gross domestic product would have expanded at an only mediocre pace: 3.5 percent.

Because the quarter ended on a stronger note than it began, stepped-up military spending may not be necessary to sustain the economic recovery in the weeks ahead. Retail sales, home sales and consumer confidence all accelerated in March, the quarter's final month, and that acceleration appears to have continued through April.

"We are in the sweet spot of the recovery right now, and the second quarter is also likely to be strong," said Mark Zandi, chief economist at Economy.com, a forecasting and data-gathering firm. The big uncertainty, for Mr. Zandi and for other forecasters, is what will happen in the second half of the year.

Persistently low interest rates and low inflation, coupled with widespread mortgage refinancing, gave homeowners hundreds of millions of dollars in extra spending power and finally turned a sluggish recovery into a vigorous one over the last nine months. Now those supports are fading, suggesting that the surge in economic growth - the G.D.P. has risen at a 5.5 percent annual rate since October - might not last. And if growth tapers off, so will job creation. Total employment has been rising since August, but is still well below its level in November 2001, when the recovery began.

The Bush administration greeted yesterday's G.D.P. report as confirmation that the president's tax cuts are working. "America's economy is poised for long-term growth," Treasury Secretary John W. Snow said.

John Kerry, the presumptive Democratic presidential nominee, focused not on the G.D.P. report but on the still subpar job creation. "We all know that America is at its best when it's at work," Mr. Kerry said, according to The Associated Press.

Neither party addressed the unexpected contribution of military spending to economic growth. It accounted for $17.4 billion of the $108.5 billion increase in the G.D.P. in the first quarter, adjusted for inflation. Not since the second quarter of last year, when the war started, has military spending been so important to growth.

Most of the increased spending went to the Air Force, for "base support equipment," the Bureau of Economic Analysis reported. Very little went for weaponry, although that might change if the fighting continues to escalate.

"Clearly military spending is more elevated because of Iraq than people had expected," said William C. Dudley, director of domestic economic research at Goldman Sachs.

The financial markets reacted negatively to the new G.D.P. report. Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast. The Dow Jones industrial average dropped 70.33, closing at 10,272. Bond prices, meanwhile, dropped as the data heightened concern that the Federal Reserve will soon raise interest rates to hold inflation in check. The yield on the 10-year Treasury bond, which moves inversely to the price, rose to 4.54 percent, from 4.50 percent on Wednesday.

Most forecasters had expected the G.D.P. to expand at an annual rate of at least 5 percent. They had counted on manufacturers to raise production for two reasons: to keep up with current brisk sales and to build up inventories in anticipation of more spending to come. The inventory buildup barely happened. Stockpiling rose at an annual rate of $15.3 billion. While that was nearly double the fourth-quarter pace, it was far short of the $30 billion to $40 billion that forecasters had expected.

"That was the major shortfall in my forecast and I assume in most others," said Lynn Reaser, the chief economist at Banc of America Capital Management. She had expected a growth rate of nearly 5 percent and now expects at least that much in the second quarter, assuming that inventory accumulation finally kicks in.

 

[charrison]

Originally posted by: conjur
http://www.nytimes.com/2004/04/30/business/30econ.html?ex=1083902400&en=bb147e6069623afc&ei=5062&partner=GOOGLE

The American economy grew at a vigorous annual rate of 4.2 percent in the first quarter, with military spending making a significant contribution to economic growth for the first time since the early days of the war in Iraq.

Consumers provided most of the lift, the Bureau of Economic Analysis reported yesterday. Business investment was also strong, adding more to the growth rate than the military outlays. Without the war spending, however, the gross domestic product would have expanded at an only mediocre pace: 3.5 percent.

Because the quarter ended on a stronger note than it began, stepped-up military spending may not be necessary to sustain the economic recovery in the weeks ahead. Retail sales, home sales and consumer confidence all accelerated in March, the quarter's final month, and that acceleration appears to have continued through April.

"We are in the sweet spot of the recovery right now, and the second quarter is also likely to be strong," said Mark Zandi, chief economist at Economy.com, a forecasting and data-gathering firm. The big uncertainty, for Mr. Zandi and for other forecasters, is what will happen in the second half of the year.

Persistently low interest rates and low inflation, coupled with widespread mortgage refinancing, gave homeowners hundreds of millions of dollars in extra spending power and finally turned a sluggish recovery into a vigorous one over the last nine months. Now those supports are fading, suggesting that the surge in economic growth - the G.D.P. has risen at a 5.5 percent annual rate since October - might not last. And if growth tapers off, so will job creation. Total employment has been rising since August, but is still well below its level in November 2001, when the recovery began.

The Bush administration greeted yesterday's G.D.P. report as confirmation that the president's tax cuts are working. "America's economy is poised for long-term growth," Treasury Secretary John W. Snow said.

John Kerry, the presumptive Democratic presidential nominee, focused not on the G.D.P. report but on the still subpar job creation. "We all know that America is at its best when it's at work," Mr. Kerry said, according to The Associated Press.

Neither party addressed the unexpected contribution of military spending to economic growth. It accounted for $17.4 billion of the $108.5 billion increase in the G.D.P. in the first quarter, adjusted for inflation. Not since the second quarter of last year, when the war started, has military spending been so important to growth.

Most of the increased spending went to the Air Force, for "base support equipment," the Bureau of Economic Analysis reported. Very little went for weaponry, although that might change if the fighting continues to escalate.

"Clearly military spending is more elevated because of Iraq than people had expected," said William C. Dudley, director of domestic economic research at Goldman Sachs.

The financial markets reacted negatively to the new G.D.P. report. Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast. The Dow Jones industrial average dropped 70.33, closing at 10,272. Bond prices, meanwhile, dropped as the data heightened concern that the Federal Reserve will soon raise interest rates to hold inflation in check. The yield on the 10-year Treasury bond, which moves inversely to the price, rose to 4.54 percent, from 4.50 percent on Wednesday.

Most forecasters had expected the G.D.P. to expand at an annual rate of at least 5 percent. They had counted on manufacturers to raise production for two reasons: to keep up with current brisk sales and to build up inventories in anticipation of more spending to come. The inventory buildup barely happened. Stockpiling rose at an annual rate of $15.3 billion. While that was nearly double the fourth-quarter pace, it was far short of the $30 billion to $40 billion that forecasters had expected.

"That was the major shortfall in my forecast and I assume in most others," said Lynn Reaser, the chief economist at Banc of America Capital Management. She had expected a growth rate of nearly 5 percent and now expects at least that much in the second quarter, assuming that inventory accumulation finally kicks in.

Sounds like things are beginning to fire on all cyliders.....

 

[conjur]

Originally posted by: charrison
Sounds like things are beginning to fire on all cyliders.....

"Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast"


Yeah...sure does.

 

[charrison]

Originally posted by: conjur

Originally posted by: charrison
Sounds like things are beginning to fire on all cyliders.....

"Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast"


Yeah...sure does.

It has been a fickle market lately...

Care to guess were 4.0 growth falls in historical terms?

 

[conjur]

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison
Sounds like things are beginning to fire on all cyliders.....

"Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast"


Yeah...sure does.

It has been a fickle market lately...

Care to guess were 4.0 growth falls in historical terms?

"Without the war spending, however, the gross domestic product would have expanded at an only mediocre pace: 3.5 percent. "

 

[charrison]

Originally posted by: conjur

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison
Sounds like things are beginning to fire on all cyliders.....

"Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast"


Yeah...sure does.

It has been a fickle market lately...

Care to guess were 4.0 growth falls in historical terms?

"Without the war spending, however, the gross domestic product would have expanded at an only mediocre pace: 3.5 percent. "

Care to guess were 3.5 falls?

18 quarters during the previous admin fell below 3.5

 

[xxxxxJohnGaltxxxxx]

Originally posted by: conjur

Originally posted by: charrison
Sounds like things are beginning to fire on all cyliders.....

"Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast"


Yeah...sure does.

That's funny....most economist who work with the data expected positive growth, but slightly less than the final Q4 2003 figure...guess everyone's an "analyst" nowadays and can ?guess? right down to the percentage point before any aggregation takes place.

"only mediocre pace: 3.5 percent" So, too, is that quite funny. I need to be an "analyst."

 

[conjur]

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison
Sounds like things are beginning to fire on all cyliders.....

"Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast"


Yeah...sure does.

It has been a fickle market lately...

Care to guess were 4.0 growth falls in historical terms?

"Without the war spending, however, the gross domestic product would have expanded at an only mediocre pace: 3.5 percent. "

Care to guess were 3.5 falls?

18 quarters during the previous admin fell below 3.5

Clinton
1993 01 2.7
1994 01 4.0
1995 01 2.5
1996 01 3.7
1997 01 4.5
1998 01 4.2
1999 01 4.5
2000 01 3.7

Bush
2001 01 0.5
2002 01 2.2
2003 01 3.1

 

[charrison]

Originally posted by: conjur

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison
Sounds like things are beginning to fire on all cyliders.....

"Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast"


Yeah...sure does.

It has been a fickle market lately...

Care to guess were 4.0 growth falls in historical terms?

"Without the war spending, however, the gross domestic product would have expanded at an only mediocre pace: 3.5 percent. "

Care to guess were 3.5 falls?

18 quarters during the previous admin fell below 3.5

Clinton
1993 01 2.7
1994 01 4.0
1995 01 2.5
1996 01 3.7
1997 01 4.5
1998 01 4.2
1999 01 4.5
2000 01 3.7

Bush
2001 01 0.5
2002 01 2.2
2003 01 3.1

First those are not quarters, those are yearly averages.

Second your data appears to be off.....

1993 01 0.5
1993 02 2.0
1993 03 2.1
1993 04 5.5
1994 01 4.1
1994 02 5.3
1994 03 2.3
1994 04 4.8
1995 01 1.1
1995 02 0.7
1995 03 3.3
1995 04 3.0
1996 01 2.9
1996 02 6.7
1996 03 3.4
1996 04 4.8
1997 01 3.1
1997 02 6.2
1997 03 5.1
1997 04 3.0
1998 01 4.5
1998 02 2.7
1998 03 4.7
1998 04 6.2
1999 01 3.4
1999 02 3.4
1999 03 4.8
1999 04 7.3
2000 01 1.0
2000 02 6.4
2000 03-0.5
2000 04 2.1
2001 01 -0.2
2001 02 -0.6
2001 03 -1.3
2001 04 2.0
2002 01 4.7
2002 02 1.9
2002 03 3.4
2002 04 1.3
2003 01 2.0
2003 02 3.1
2003 03 8.2
2003 04 4.1

 

[xxxxxJohnGaltxxxxx]

Originally posted by: charrison

2003 03 8.2

That figure still gives me a semi

 

[conjur]

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison
Sounds like things are beginning to fire on all cyliders.....

"Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast"


Yeah...sure does.

It has been a fickle market lately...

Care to guess were 4.0 growth falls in historical terms?

"Without the war spending, however, the gross domestic product would have expanded at an only mediocre pace: 3.5 percent. "

Care to guess were 3.5 falls?

18 quarters during the previous admin fell below 3.5

Clinton
1993 01 2.7
1994 01 4.0
1995 01 2.5
1996 01 3.7
1997 01 4.5
1998 01 4.2
1999 01 4.5
2000 01 3.7

Bush
2001 01 0.5
2002 01 2.2
2003 01 3.1

First those are not quarters, those are yearly averages.

Second your data appears to be off.....

You might want to tell them that:

http://www.economagic.com/em-cgi/data.exe/nipa/T1t1t1l1a

 

[charrison]

Originally posted by: conjur

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison

Originally posted by: conjur

Originally posted by: charrison
Sounds like things are beginning to fire on all cyliders.....

"Stocks fell, reflecting investor disappointment that the growth rate was slower than what many analysts had forecast"


Yeah...sure does.

It has been a fickle market lately...

Care to guess were 4.0 growth falls in historical terms?

"Without the war spending, however, the gross domestic product would have expanded at an only mediocre pace: 3.5 percent. "

Care to guess were 3.5 falls?

18 quarters during the previous admin fell below 3.5

Clinton
1993 01 2.7
1994 01 4.0
1995 01 2.5
1996 01 3.7
1997 01 4.5
1998 01 4.2
1999 01 4.5
2000 01 3.7

Bush
2001 01 0.5
2002 01 2.2
2003 01 3.1

First those are not quarters, those are yearly averages.

Second your data appears to be off.....

You might want to tell them that:

http://www.economagic.com/em-cgi/data.exe/nipa/T1t1t1l1a

Maybe galt can tell us which ones are right....

But it still looks like those numbers are off...

 

[xxxxxJohnGaltxxxxx]

Originally posted by: charrison


Maybe galt can tell us which ones are right....

But it still looks like those numbers are off...

Why would you go to some 'economagic' nonsense instead of the source?

I'll link a spreadsheet in a few minutes...


[edit] this was supposed to be in response to Conjur's site...wrong 'quote' button

 

[conjur]

I didn't see any charts from sites like cbo.gov or esa.doc.gov or bea.gov

 

[xxxxxJohnGaltxxxxx]

Table with GDP figures (2000-2004)