On Real GDP Growth
Kash provided a few details as to the news about real GDP growth during the third quarter. William Polley compares this news to the news for last quarter noting what we said back then:
Final sales of domestic product grew at a 5.8% annualized rate with the difference between growth in sales and the growth in production coming from a “negative contribution from private inventory investment”. Could this news be a harbinger of an export and investment led recovery, which would might increase the employment to population ratio to 63% by year end? One can only hope!
For the third quarter, final sales of domestic product grew at a 4.4% annualized rate. Hopefully, this means we will continue to inch closer to full employment. We might also note that government purchases, which had been growing rather slowly, grew at a 3.2% annualized rate. With strong consumption growth, this means the low national savings rate remains low.