GDP increased 6.5%, well below expectations but topping pre-Covid levels

[peppertree]

The U.S. economy rose at a disappointing rate in the second quarter in a sign that the U.S. has escaped the shackles of the Covid-19 pandemic but still has more work to do, the Commerce Department reported Thursday.

Gross domestic product, a measure of all goods and services produced during the April-to-June period, accelerated 6.5% on an annualized basis - slightly better than the 6.3% gain in the first quarter, which was revised down narrowly.

While that would have been strong prior to the pandemic, the gain was considerably less than the 8.4% Dow Jones estimate.

Gross private domestic investment fell 3.5% as declines in private inventory and residential investment held back gains.

Rising imports and a 5% decline in the rate of federal government spending also were factors, the Bureau of Economic Analysis report said.

The overall increase came thanks to increasing private expenditures, which rose 11.8% as private consumption accounted for 69% of all activity. Nonresidential fixed investment, exports and state and local government spending also helped boost output.

At: https://www.nbcnews.com/business/autos/gdp-increased-6-5-well-below-expectations-n1275377

Chef Sean Sherman at his newly-opened Owamni restaurant in Minneapolis.

Higher spending on food services and accommodation accounted for a full one third of growth in the second quarter - though the emergence of the Delta variant has clouded prospects for the sector moving forward.

[Budi]

1. Considering where we were 6 mo ago..I'm calling that 6.5% a BFD.

Thanks President Biden.

[Bristlecone]

2. It's never enough for the Dow Jones

2017: +2.3%

2018: +3%

2019: +2.2%

2020: -3.7%

[peppertree]

3. ...if a Democrat happens to be in office

As you may have noticed over the past 30 years (assuming you're of a certain age - I don't know!), under Clinton and Obama the word that kept coming up in GDP news stories was "lackluster."

3%? "Lackluster"

2% "very lackluster"

Under Bush and Cheeto - same numbers - they word they kept bringing up was "boom."

The economy went went "boom" under those clowns alright: as in ka-boom.

[Bristlecone]

4. I voted for Clinton in my first presidential election

yes, I remember. So we picked up the negative 3.7 for last year and tacked on additional growth of 3-ish. While still in a global pandemic.

[peppertree]

5. Absolutely. Here's hoping voters remember in November ('22).

One of my first lessons in mass voter manipulation was the '94 disaster (I was in high school).

It taught me that, despite the economic rebound from the Bush downturn under Clinton, the Repugs had an evil talent for using anything and everything to turn voters away from Democrats in the mid-terms (and bigly!).

Health care, Hillary, Lani Guinier, Vince Foster, Waco, gun control: it all worked to distract voters from the improving economy - an improvement voters themselves felt, as seen in consumer confidence numbers at the time.

Granted, it was a whiter electorate - more susceptible to dog whistles. But Biden can't afford any more big mistakes like the mask guidance flap.

Even in a good economy.