Funny, we've been told by the GOP that the stimulous package was an abject failure- even though only a fraction of it has been spent.

I await the daily spin on this new GDP info. . .

But the Repukes will still scream that the stimulus isn't working, stop the stimulus, etc. They'll do anything to crash this country further leading to the midterms.

let's see...economy expands and unemployment expands. i'm not much of an economic thinker, but i'd say the thriving economy is eatin' people.

that's good? i dont think so...

They won't bother chasing the stimulus, per se -- they'll switch to harping on the deficit, and they'll get a lot of Democratic help on the project.

I expect a second, 1937-style recession about the end of 2010 or early in 2011, as federal stimulus spending tails off and the states finally just give up.

How soon until this is dubbed (by the rabid rightwing) the "Bush recovery"?

Tell all of that good news about the "economy coming back to life" to the 530,000 people who filed jobless claims last week, or to the 18.8% of the work force that is unemployed. Tell that to the people who are included in the record number of people whose homes were foreclosed in the third quarter of this year. Tell that to the people whose interest rates on credit card balances current and promptly paid was just raised to 30% and more. Tell that to working men and women whose hours and wages are still being reduced. Tell that to holiday retailers who are not hiring seasonal workers because the holiday sales forecast is, at best, "flat."

Pulling an unknown number of months worth of auto sales forward into a single month by means of a one-month subsidy and creating a down-the-road sales slump does not constitute economic growth. Creating a spike in home sales by means of a short term "tax credit" and low interest rates to artificially drive up prices and home sales by using the same methods that created the housing bubble in the first place does not constitute economic growth. More than 100 banks failed so far this year and many more on the brink is not economic growth.

When I see employment rising significantly and indebtedness decreasing and a major portion of the bad debt written off then I will believe that the economy is improving.

Yeah, exactly what Bill H sez.

This little pep talk about "robust GDP growth" is a PR sale of derivatives of econo-propaganda...

"GDP" is always already a corporate wealth evaluation not a human one...they just throw galley slaves over the side and increase the drumbeat.

A lot of people will hear this news and apply it to themselves: is my GDP improving? Probably not. The nostrum is that the recession is officially over when I get my raise.

Neill and Bill H

Jobs are a trailing indicator. If you want them to come back you need a growing economy.

Yes, Obama hasn't fixed all the massive damage caused by years of economic malfeasance. But he's doing this one step at a time, and the first step was to pull out of the economic power dive we were in. But fixing the rest of it will take years.

While it is good to see some positive numbers in certain areas, overall I agree with neill and Bill H that the primary indicators affecting most people are still somewhat negative.

nonsense. Tomorrow we will have a report showing that the indicators are skewed and the reality report will show up. Has no one noticed that in the last several years that no two reports about employment, deficit, spending, or anything else have ever matched? One day, housing is up! next, they forgot to include the lack of sales figures for a main demographic. One day, unemployment remains the same! Except they didn't include any mention of under employment or those that have had to stop looking. That happened this week.
If anyone believes the GDP is going up, they might as well call the pope and offer to give him a nice blow. Its a lie for feel good status. Reporting on what is claimed by the government can not be considered reporting any longer. It is only covering lies made up for propaganda sake. Please Steve, the grain of salt matters.

GDP is one of the worst measures we have of economic activity. Way too much of it is based on purely paper effects (so, for example, the rebound of the financial industry, with more people selling crap to each other once again, counts as positive for GDP even though it's likely a negative for the rest of us). Imagine how thoroughly different our outlook on the economy would be if employment, hours worked and median household income were the figures that got the most play.

Funny, we've been told by the GOP that the stimulous package was an abject failure- even though only a fraction of it has been spent.

Let's not forget that we're also hearing this from progressives who don't like Obama, too. Basically, anyone who doesn't like Obama will insist that everything he does is a failure, with Republicans attacking him for doing too much and progressives attacking him for doing too little. Yet the majority of America continues to think he's doing it just right.

And that includes the people here who don't seem to remember that employment is a lagging indicator, and that companies often don't fire people until months after they should have, or begin rehiring them when they need them. And that's not because corporations are evil or greedy (though many are), but because they're very large and they can't possibly react to changing economic conditions until at least two months after they occur. Even small businesses can't properly judge their business until at least two weeks after the end of a month. That's just how long it takes their accountants to crunch the numbers; assuming they have accountants to do that. And a large corporation is going to take even longer to make employment decisions. That's the big problem with business: By the time you have enough information to make a smart decision, it's already too late.

But of course, I support Obama, so that automatically means everything I say is meaningless propaganda which only proves how brainless I am.

JimBoB
Jobs are a trailing indicator when they are not improving. That is not the case here; jobs are still declining, meaning that buying power is declining, home foreclosures are still increasing, and all parts of the real economy are still in a slide.

Sooner or later, all this will boil down to J O B S.

I'm very happy about these numbers. But the economy can rely on government transfusions only for so long; the patient will have to come off government life support sooner or later.

We have multiple systematic issues in this economy that have yet to be addressed. We're not completely out of the woods on the mortgage debacle yet.

But it still seems like business overall is SLOW.

Oh goodie for you, now you'll have more money to pay your underwater loans and credit-card interest which the banks will disburse your legislators so they can stay in office and help the banks keep fucking you!

Jobs are a trailing indicator when they are not improving.

No, they are a trailing indicator, full stop.

(Actually they are improving, if you look at this week versus last week's figures. I know, I know, not very significant.)

The rest of the economy isn't great. It never is during a major downturn. As I said, it'll take years to climb out of the hole. But seeing an increase in GDP is meaningful, and is far better than seeing it decrease.

You pessimists are just blind partisans who will say anything to undercut the undeniable achievements of President Blankfein.

"Disposable personal income decreased $20.4 billion (0.7 percent) in the third quarter, in contrast to an increase of $138.2 billion (5.2 percent) in the second. Real disposable personal income decreased 3.4 percent, in contrast to an increase of 3.8 percent."

That's worse. A lot worse. Disposable personal income decreased in nominal terms q/o/q by 5.9% while in real terms (inflation adjusted) it decreased q/o/q by 7.4%! That is an enormous swing in purchasing power and not in the right direction!

Nothing in here I like; to the contrary, this report sucks and on a drill-down appears to be full of outright lies.

Looking inside the data, the "big change" in private domestic investment is all residential fixed - up 23.4%. I don't believe it. I've been scouring the homebuilder earnings releases and data, and I don't see the numbers that support this. An improvement over the ditch-diving of the last many quarters, yes - but a 23.4% increase, a swing of fifty percent from Q2-Q3? Oh hell no. Where is it? It's not in Home Depot's or Lowe's quarterly results, it's not in the homebuilders, and I can't find it in the suppliers (lumber companies, etc) either. This sort of move would result in monstrous top-line revenue increases reported by firms in this sector and that simply has not happened.

Nor do the export and import numbers look right. Those numbers also don't add up - swings of 20-25% in one quarter? Not reflected in container volumes and freight loadings. Yet it has to be - how do you get something in or out of here without it going through a port?

Government looks right, both federal and state/local. The "Obama will cut defense and war spending" folks have to be bashing themselves with a hammer - there's no evidence for that in the data, now three quarters into his administration. If you're anti-war and "bring the troops home", you may want to re-think whether voting for Obama was a wise decision - he sure as hell hasn't kept that promise.

Forward the big problem is the deterioration in personal income. You can't spend what you don't have without credit creation, and that's fallen off a cliff. The Fed's credit reports continue to come in with huge contractions - this should not surprise, as demanding that banks lend to people who are seeing their income shrink is into the realm of pure idiocy.

You can't expect the cheerleaders on CNBC to read beyond the headline numbers, and they (once again) did not disappoint in this regard. The first 20 minutes of "analysis" brought not one mention of the decease in personal income or disposable personal income, yet on a forward basis this is in fact the most important piece of information in the report.

You cannot have an economic recovery when on a q/o/q basis real disposable income is contracting at a 7.4% annual rate and worse, the spread between nominal and real income is widening, indicating that mandatory purchases such a food, energy and health care - are increasing.

How do "they" explain 30% shortfalls in tax revenues?

It's All Lies.

Every economic website I'm reading says these numbers are a crock. Any uptick is due to government spending, so when that ends, numbers will go back down. In the meantime, the loss of income on Main Street is translating to fewer taxes being paid and less money being spent. A lot of stores are holding on for the Xmas sales and will close afterward (affecting already taking commercial real estate, which will take more banks with it). I see the biggest problem at the state and local levels, because so many state governments cannot pay their bills. So they are cutting services and raising property taxes which, I feel, will lead to a further revolt among the population. At some point the sheeple have to wake up and finally notice that everything has been sold or given away and there is nothing left for them but tents in the national parks.

you may want to re-think whether voting for Obama was a wise decision

Given the choice, it was the only decision. I wouldn't give Obama stellar grades thus far, but I am confident the alternative would have been much worse.

The only decision. I see. So what you're saying is, you had no choice. Funny how it has a way of working out like that. Yet you wasted your time voting even though the self-limiting economic incompetence of the right ensured a win for the banker's candidate. Well yay for you, you... won!!!

Given the choice, it was the only decision.

Have to disagree. Dennis Kucinich would have been the better choice as the anti-war candidate.

you may want to re-think whether voting for Obama was a wise decision

So you're saying McCain would have been better?

Dennis Kucinich would have been the better choice as the anti-war candidate.

Get real. Kucinich wasn't on the ballot in November, where the winner was going to be either Obama/Biden or McCain/Palin.

Notes to Steve:

1. Team Obama shifts goalposts from job creation to economically-defined end of recovery.
2. Cash for Clunkers was NOT environmental, has now ended anyway, and costs thousands of $$ per destroyed car.
3. Housing tax credit ends, the end of next month.

A second leg on a W-shaped recession is possible, and we'll see what Team Obama does or does not do.

Qwerty: I voted GREEN, because Cynthia McKinney was on the ballot, and I saw through Obama nearly 2 full years ago.

Have fun "enabling," you spouses of "alcoholic" politicians.

Speaking of enabling, I also like how "new media" Talking Points Memo is suddenly "old media" on its use of anonymous sources.

@qwerty: As 'stimulate this' implies, we were never really given a choice. Is Obama better than McCain? It depends on what is important to you. What is sure is that the bankers who control this country approved both of them, so we lost no matter who we voted for. Sure, there may be real progressives in the primaries but it's set so that if they have the slightest shot at winning the media and Wall Street will make sure they never do (read Dean in '04). It's been like that in every election I've ever voted in (my first was 1980). Eventually you'll realize that our elections are just as much a sham as the Iran or Afghan elections are. We just enjoy lying to ourselves that we really have a choice or that we really are a democracy (at least at the federal level). After 30 years of voting I've learned that only locally can you really have an effect and that's where we all should concentrate our energies.

Gosh,

I was just going to thank Steve to doing that graph and showing we have already gone through a -w- shaped double downturn.

Look, the economy is going to recover, and in time for the 2010 elections.

It's good news that will be even better news if it continues -- about this you can find learned arguments for and against, including my favorite, which was Paul Krugman's warning that the stimulus was not nearly big enough. Much of the stimulus has still not been spent, and much of the authorized investment in new energy technology still has not been spent, so the domestic energy sector can expect more growth. The decline in the dollar has enhanced the export-oriented industries.

What's even more impressive than the 3.5% GDP growth (acknowledging weaknesses in the GDP measurements) is the nearly 10% turnaround. over three quarters.

Davis X. Machina expects a 1937 style recession in 2010. Maybe, but new energy developments will continue to grow, and the Bush tax cuts won't expire until the end of the year.

Kucinich wasn't on the ballot in November

If you're anti-war and "bring the troops home", you may want to re-think whether voting for Obama was a wise decision - he sure as hell hasn't kept that promise.

I don't see any mention of "November" in the original post.

The lesser known U-6 jobless rate, including the long-term unemployed, and part timers seeking full-time work, is hovering at 17%, reminiscent of the Great Depression era.

A Republican President would "have to" get credit for a revived economy, from not just the dextrotariat but the Villagers as well.