Thursday, November 29, 2007

Should the economy scare you?

I wish I’d kept count the past few months of all those MSM gloom and doom stories about the economy.

It seems a very serious recession is just about to begin. Tomorrow, right? Or is it next Monday?

Meanwhile from blogger Ed Morrissey at Captain’s Quearters:

As the presidential election continues to draw nearer, we keep hearing about our collapsing economy from the usual media hysterics. The housing market is near collapse! The credit crunch! The subprime markets are melting, melting, I say!

Well, what about the actual economy?

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 4.9 percent in the third quarter of 2007, according to preliminary estimates released by the Bureau of Economic Analysis.

In the second quarter, real GDP increased 3.8 percent. The GDP estimates released today are based on more complete source data than were available for the advance estimates issued last month. In the advance estimates, the increase in real GDP was 3.9 percent ...

The increase in real GDP in the third quarter primarily reflected positive contributions from exports, personal consumption expenditures (PCE), private inventory investment, equipment and software, federal government spending, nonresidential structures, and state and local government spending that were partly offset by a negative contribution from residential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.

It appears that we're growing our way into a panic on the economy. It may be the first recession in history initiated by a 5% annual GDP growth rate.

It won't be the first attempted by scare tactics in the run-up to an election.
The rest of Morrissey’s post is here.

No one can be certain what the economy will do. But data Morrissey cites and much other data suggest we’re not on the verge of a major recession, or even a moderate one despite what you read in the New York Times, whose own stock has keeps hitting record lows.