Today’s first take on real GDP showed that the U.S. economy expanded 3.2% on an annualized basis during the first three months of 2010. Many of the underlying details suggest that the economy remains on a path to recovery; however, even though the data have reduced the probability of a double-dip recession to a very small number (practically zero, in our opinion), the chances of a V-shaped recovery also appear to be slim. The report contained some positive bits of news to be sure, such as double-digit growth in capex spending and an outright increase in business inventories, but a 2.2% annualized increase in final sales to domestic purchasers points to an economy that is not growing rapidly enough yet to provide a boost to the labor market.

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