The Commerce Department reported that the nation's economic output was the weakest since the third quarter of 2001, but it wasn't as bad a showing as Wall Street had feared. The department said the gross domestic product, the measure of all goods and services produced within the U.S. fell at a 0.3 percent annual rate in the July-September quarter, rather than 0.5 percent as expected.
To put this in perspective, the 1953-54 recession began with a 2.4% GNP decline in the 4th quarter. The 57-58 recession began with a 4.2% decline in Q4. The 69-70 recession began with a 1.9% decline in Q4. The 73-74 recession began with a 2.1% decline in Q3. The 1980 recession began with a 7.8% decline in Q3. The 81-82 recession began with a 4.9% decline in Q4. The 90-91 recession began with a 3% decline in Q4. The 2001 recession began with a 0.5% decline in Q1. With this in mind, the current recession is beginning with the smallest opening-quarter decline of any recession since 1950 (questions follow below the fold).
Might the hysteria of the past six weeks be a bit overdone, and things really don't look as bad as Wall Street, the media, and Obama-Biden are claiming? Given all the stimulus and liquidity injected into the system around the globe, is it possible a serious recession can be prevented, and things are nowhere near as gloomy as they feel? Or, is this the calm before the real storm hits in coming quarters?
