By Dan Calabrese ——Bio and Archives--May 29, 2015
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It's certainly not the first time this has happened. In fact, the downward revision has become something of a tradition during the Obama presidency. No matter how bad the initial news is, the reality can always turn out to be even worse. And with these people running the show, you can usually count on it.Gross domestic product shrank at a 0.7 percent annualized rate in the first quarter, revised from a previously reported 0.2 percent gain, according to Commerce Department figures issued Friday in Washington. That’s the weakest reading since frigid winter temperatures derailed growth at the start of 2014. While bad weather once again probably contributed to last quarter’s slump, other impediments were also at work -- including a swelling trade deficit caused by a strong dollar and plunging investment in oil exploration following the drop in fuel prices. Federal Reserve officials are among those who believe the slowdown will be temporary, helping explain why they are considering raising interest rates later this year. “The economy slowed in the first quarter but we’ll see an acceleration in the second quarter,” said Michael Gapen, New York-based chief U.S. economist for Barclays Plc. “It keeps the Fed in line for a rate hike in September.”You have to love Bloomberg, buying the Obama Administration's excuse about the weather for a second year in a row. By the way, that first quarter of 2014 wasn't just derailed growth. The economy contracted more than 3 percent that quarter. And as for the "acceleration" Michael Gapen predicts, well yeah, it would be hard not to accelerate from a contraction of 0.7 percent - although it's not impossible. One more quarter of this and we're officially in a recession.
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