The Recovery Begins to Fade Before Our Eyes

The recovery has been weaker than originally thought
Gross domestic product for the second quarter grew 1.5 percent, down from its 1.9 percent pace during the first three months of the year. Photograph by Siegfried Marque/Gallery Stock

This morning we learned (PDF) what we’d all suspected for the last few months: The U.S. economy is slowing down. Gross domestic product for the second quarter grew 1.5 percent, down from its 1.9 percent pace during the first three months of the year, which was down from 4 percent at the end of 2011. Dismal as that is, second-quarter growth was actually faster than most had estimated. The median forecast of economists surveyed by Bloomberg was for 1.4 percent growth. So while it’s bad, it’s not as bad as we thought. And that, strangely, appears to be good news, at least as far as the market is concerned. The Dow was up more than 100 points in afternoon trading.

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