News came out today showing that the pace of the declining economy fell at just one percent in the second quarter. The results coincide with many of the latest company reports, showing better than expected results and giving us a glimpse at a recession that is winding down.
The decline in the GDP (complete value of goods and services ie. cars, clothes, accessories, machinery produced in the U.S.) in the last quarter is much less than the nearly 6 1/2 percent rate at which the economy was declining in the first part of the year. That was the sharpest rate of decline in almost thirty years. This is the fourth consecutive quarter that the economy has contracted, making it a first, on record, since the late 1940's.
Although the latest reports show an economy still on the decline, the latest numbers were expected to be much higher than they were. Economists were previously expecting a decline rate closer to 1 1/2 percent.
Economic Advisor, Joel Naroff said, "The recession looks to have largely bottomed in the spring.......Businesses have made most of the adjustments they needed to make, and that will set up the economy to resume growing in the summer".
The economy still shows signs that the consumer continues to be cautious with their spending, with unemployment, shrinking savings and declining home prices being the leading factors.
