The U.S. Economy Is Booming!

 

Here’s an early Christmas present: New government data suggest the U.S. economy is back on track.

The economy grew at a 5 percent annual pace in the third quarter, higher than the 3.9 percent growth the Commerce Department had previously estimated and the best quarterly growth since 2003. As the Washington Post’s Matt O’Brien writes, the U.S. also capped off the best six months the economy has had in over a decade, following 4.6 percent growth in the second quarter.

The real estate market remains sluggish and many Americans are underemployed, and these new figures could eventually be revised downward again. For now, however, it appears that consumer spending, government spending and private investment are growing faster than they have in years. Ana Swanson | December 23, 2014

The U.S. economy is booming. "The better way to tell the economy's underlying strength is to strip out the volatile inventory and net export numbers, and only look at consumer spending, government spending, and private investment—and over a year, not a quarter, to smooth out any weird weather effects, like last year's polar vortex-induced slump. This goes by the catchy name of final sales to domestic purchasers, and it shows us how much of today's growth we can expect to continue tomorrow. The surprising answer is that, even though annual GDP growth slowed from 2.7 percent in the third quarter to 2.5 percent in the fourth, this "core" growth actually ticked up from 2.7 to 2.8 percent. And that, as you can see above, is the best it's been the whole recovery." Matt O'Brien in The Washington Post.