Last summer, with market turmoil, a vicious hurricane, and the debt downgrade, it sure seemed like the U.S. was headed back into recession, and soon. The economy had slowed to near stall speed in the first and second quarters, bad news seemed to flow in from all over, and the most reliable progonosticators were forecasting gloom. In late September, Lakshman Achuthan of Economic Cycle Research Institute proclaimed on The Daily Ticker that an economic contraction was unavoidable.
But a funny thing happened on the way to the next recession. Instead of decelerating in the summer and the fall, the economy seems to have accelerated. While Europe muddles its way into stagnation, the U.S. seems to be plowing ahead. The good times are hardly rolling. But as Henry and I discuss in the accompanying segment, the flow of economic data in recent weeks has been almost uniformly positive.
Take the broadest measure: GDP. After growing at a .4 percent annual rate in the first quarter and a 1.3 percent annual rate in the second quarter, the Commerce Department today gave its second answer on third quarter growth: 2.0 percent. That’s a downward revision from the previously reported figure, but it still
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