Double dip recession looming? Economic growth revised down to 1.6% annualized
August 27, 2010 04:02 PM EDT (Updated: August 27, 2010 11:51 PM EDT)
views: 197 | 1 person recommends this | comments: 1
What has been a dramatic slowdown and a reason to stoke talks of a possible double dip recession has business owners scratching their heads. How could the economy go from an expected growth of plus three percent to less thhan 2% annualized? The Commerce Department revised the economic growth to 1.6% measured in terms of real gdp growth rate for the second quarter. Although this was a big revision downward from the preliminary numbers, there is yet a silver lining.
Consumer spending grew at a modest 2% annualized and polled economists expected worse for the downward revision. What’s more, inventories held by business were not as high as expected making a turnaround scenario more robust if it were to happen.
So far economists and businesses have dramatically lowered their expectations of economic growth but few believe that there will be a double dip recession. Although economist, Robert Shiller when interviewed by the Wall Street Journal recently said that he believed the economy had more than a 50% chance of falling into a double dip recession despite the fact that this event is rare
