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Economy Grows at Healthy
4.1 Percent Rate
By JEANNINE AVERSA
(Direct
descendent of Karl Marx!
- tha malcontent)
Associated Press Writer
Feb 27, 10:07 AM EST
WASHINGTON
(AP)
� America's economy, bolstered by brisk business spending, grew at a healthy 4.1
percent annual rate in the final quarter of 2003. That was even faster than
first thought and offered new evidence that the nation's economic recovery was
firmly rooted going into the new year.
(ap) - I can just hear it
now... "The economy fell by 50% last quarter!", a Dishonest Liberal moans!
The largest
2-Quarter Expansion since Reagan, and yet you will find an unfortunate amount of
nay-saying economic news in this "news story". I will have to give it to
the AP on this one though, it is much more positive than I would normally expect
from their particular Brand of Leftist "journalism", regardless of the Facts as
they would normally deny them! Just as Job losses follow Recessions, Job
Recoveries follow Economic Recoveries, and we are currently over 2 years into
this Recovery, post the Clinton/Algore Recession of 2000/2001. And for the
Record... The unemployment rate is lower now, than when Bush (43) entered Office
in 2001. It peaked at 6.4%, and is now down to about 5.6-5.7%... The same
rate that Clinton was applauded for in 1995/96! Anyway, when the new jobs
start coming this year, the DemocRATS will be forced to Lie about our progress
in the War on Terror, as they are already accustomed to doing! - tha malcontent)
The latest reading on the gross domestic product - the broadest measure of the
economy's health - was slightly better than the 4 percent pace estimated a month
ago for the October-to-December quarter, the Commerce Department reported
Friday. GDP measures the value of all goods and services produced within the
United States.
"The capital spending rebound is in high gear," said economist Ken Mayland,
president of ClearView Economics.
Even though the fourth quarter's growth rate marked a slowdown from the red-hot
8.2 percent pace of the third quarter - the best in nearly two decades - it
nonetheless represented a solid performance.
The 4.1 percent pace was better than economists were predicting. They were
forecasting growth rate of around 3.8 percent.
On Wall Street, the report helped to lift stocks. The Dow Jones industrials
gained 34 points and the Nasdaq was up 4 points in morning trading.
Looking ahead, the economic picture seems promising, analysts say. Economic
growth in the current January-to-March quarter is expected to clock in at a rate
of around 4.5 percent or higher, according to some analysts' projections.
For out of work Americans, though, these are still frustrating times even as the
economy is in recovery mode. Job growth has been painfully slow. The economy has
lost 2.2 million jobs since President Bush took office in January 2001, a sore
spot as he seeks re-election. Democratic presidential contenders have seized on
this to make the argument that his economic policies are not working.
Federal Reserve Chairman Alan Greenspan and other economists, however, are
hopeful that companies will step up hiring in the coming months.
In an especially encouraging sign that companies are feeling more confident in
the staying power of the recovery, they boosted investment in equipment and
software in the fourth quarter at a sizable 15.1 percent annual rate. That was
stronger than the 10 percent rate first estimated and was a main factor in GDP
being revised upward for the fourth quarter.
Another factor: Businesses were more aggressive than previously thought in
adding to their stockpiles in the fourth quarter. Business inventory building
added 0.92 percentage point to fourth-quarter GDP, even better than the 0.61
percentage-point increase estimated a month ago. That also was a sign that
businesses were betting on stronger appetites for their goods.
A sustained turnaround in capital spending by business is a key ingredient for
the economic recovery to be lasting. It was deep cuts to such spending that
thrust the economy into a recession in 2001. The economy has struggled mightily
to get back on firmer footing and finally in the second half of 2003 managed to
cast off its lethargy.
The economy's performance in the second half of last year marked the best
back-to-back quarterly performance since the first two quarters of 1984.
Economists are heartened that businesses appear to be doing more to keep the
economy going. Throughout economic hard times and during most of the recovery
consumers have been doing the heavy lifting.
In the fourth quarter, consumers spent modestly and increased their spending at
a 2.7 percent annual rate, slightly stronger than the 2.6 percent pace estimated
a month ago. Still, that marked a slowdown from the third quarter as consumers
spent lavishly - powered by extra cash from a home-mortgage refinancing frenzy
and the president's third round of tax cuts.
Analysts predicted the economy would slow in the fourth quarter compared to the
third quarter's scorching pace as the stimulative impact of refinancing and the
tax cuts faded.
Consumers in fact trimmed spending on big-ticket goods, such as cars, at a 0.1
percent rate in the fourth quarter, the first decline since the second quarter
of 2000.
Although economists believe consumers will keep their pocketbooks sufficiently
open to help along the economy, they are still keeping a close eye on their
behavior. Some economists worry that consumers might turn more cautious given
the lackluster job market.
� Copyright 2004 The Associated Press. All
rights reserved. This material may not be published, broadcast, rewritten or
redistributed.
(That depends on what the meaning of "may" is...
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Communists or DemocRATS were harmed in the making of this website, I promise!
- tha malcontent)
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