Friday, January 29, 2010

That's a mighty good number

The initial estimate of 4th quarter GDP growth is 5.7% (this is an annualized rate), a welcome improvement from the 3rd quarter's anemic 2.2%. It is not thrilling that a big chunk came from "inventory investment" (stuff produced that wasn't sold), but business investment grew almost 3% after falling almost 6% in the third quarter. Export growth continues to be very robust, growing at an 18.1% annualized rate in the 4th quarter, which is only a slight improvement over the 3rd quarter's strong 17.8%.

A couple quarters like that (assuming the number survives revisions), and unemployment will definitely start coming down.