Quelle Surprise! 3rd Quarter GDP revised downward.....

[marmar]

U.S. Economy Shrank 0.5% in 3rd Qtr, Most Since ’01 (Update1)
By Shobhana Chandra


Nov. 25 (Bloomberg) -- The U.S. economy shrank in the third quarter faster than previously estimated as consumer spending plunged by the most in almost three decades.

Gross domestic product contracted at a 0.5 percent annual pace from July through September, the most since the 2001 recession, according to revised figures from the Commerce Department today in Washington. The government’s advance estimate issued last month showed a 0.3 percent decline.

The world’s largest economy has sunk into an even deeper recession this quarter as the credit crunch, the worsening housing market, and mounting job losses cause consumers and businesses to retrench. President-elect Barack Obama yesterday warned that the U.S. may lose “millions of jobs” should the federal government not quickly enact an economic-stimulus package.

“We’ve got a big downdraft coming on,” John Silvia, chief economist at Wachovia Corp. in Charlotte, North Carolina, said before the report. “The recession is certainly looking longer and deeper. It’s just getting very tough for consumers.”

U.S. stock-index futures rallied after the Federal Reserve committed up to $800 billion in new funding to unfreeze credit for homebuyers, consumers and small businesses.

Today’s GDP report is the second of three estimates. The figures matched the median estimate of 71 economists surveyed by Bloomberg News. Forecasts ranged from declines of 0.1 percent to 0.9 percent.

The economy grew at a 2.8 percent pace in the previous three months. ......(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=newsarchive&sid=adRLNv1tKq4M

[Captain Hilts]

1. Nom de Dieu!