Inventory Growth Won't Add Much Oomph This Time

At first glance, government statistics suggest that inventory liquidation in recent quarters has cleared the decks for a powerful surge in stock building that could bolster economic growth in the months ahead. Real inventory investment shifted from a $4.7 billion (1982 dollars) annual rate of growth in the third quarter of last year to a $25 billion rate of decline through the first quarter of 1991--a change that accounted for nearly two-thirds of the drop in gross national product in the same period.

To continue reading this article you must be a Bloomberg Professional Service Subscriber.