Friday, February 27, 2009

GDP Update

The Bureau of Economic Analysis releases a series of three reports when estimating quarterly GDP:

- Advance

- Preliminary

- Final

Each subsequent report, in theory, provides a better estimate of production than the previous one. Today, the preliminary report for 4th Q 2008 was released. The report estimated a 6.2% DROP in GDP, the advance report contained an estimate of -3.8%. The durable goods component dropped a whopping 22.1% (annualized rate) in the quarter.

Real GDP is now back to mid 2007 levels. I still think that the economy will shrink to 2005 levels, so we have experienced 20% - 25% of the pain so far.....

1 comment:

MK said...

As far as the duration of the GDP contraction, I would estimate that 2nd Q 2010 will mark the bottom.