2Q GDP Revised From 3.3% to 2.8%, Final Figure Says No Recession. Really?

On July 31, 2Q GDP was reported at 1.9%. Then on August 28, 2Q GDP was revised up to 3.3%. And today we have the final 2Q GDP which was revised down to 2.8%.

For the past three quarters the final GDP growth figures are as follows:

4Q2007: -0.2%
1Q2008: +0.9%
2Q2008: 2.8%

A recession is defined as two consecutive quarters of negative GDP growth, but all the revisions are why it’s so hard to call a recession until after the fact. Now that we have some final numbers, it’s interesting to see that the NBER won’t be calling a recession since Q1 squeaked by as positive. And while the GDP data (and official definition) protects the more slippery politicians from admitting we’re in a recession, most people are feeling a weak economy in some way. Next Friday we have the non-farm payroll report which will likely continue the trend of job losses every month in 2008. As of the last jobs report on September 5, the economy had lost 605k jobs and the unemployment rate was 6.1%.