The Commerce Department reported today that the seasonally adjusted real value of the nation's production of goods and services grew at a 3.5% annual rate during the third quarter, a little better than the 3.2% average seen since 1947.

Rate of growth of real GDP (annual rates), 1947:Q2 to 2009:Q3. Shaded regions represent dates of recessions as declared by NBER.

Consumption spending is the biggest component of GDP and the main contributor to third quarter growth, accounting by itself for 2.4 percentage points out of the 3.5% total, and with consumer purchases of motor vehicles and parts alone 3/5 of the contribution of consumption. Next in importance was inventory rebuilding, which added 0.9 percentage points to the total and could make a significant further contribution in the quarters ahead. Housing is finally making a positive rather than a negative

...

The Commerce Department reported today that the seasonally adjusted real value of the nation's production of goods and services fell at a 1% annual rate during the second quarter. That's about as bad as things ever got during the recession of 2001. But after the -5.4% and -6.4% growth rates that the Commerce Department now says characterized 2008:Q4 and 2009:Q1, some folks are cheering today's news. Reminds me a little of how I've seen people in Minnesota take off their shirts for the first 40oF day of spring, a little shocking to a traveler from San Diego.

Rate of growth of real GDP (annual rates), 1947:Q2 to 2009:Q2. Shaded regions represent dates of NBER recessions.

On the other hand, our Econbrowser Recession Indicator Index is impressed with just how cold the winter was. This is a pattern

...

The Bureau of Economic Analysis reported today that U.S. real GDP fell at a 0.3% annual rate in the third quarter of 2008. That's the second quarter of negative real GDP growth out of the last four, and puts the cumulative annual growth since 2007:Q3 at an anemic 0.8%.

As expected, the most important factor was the 3.1% drop in real personal consumption expenditures during 2008:Q3. Given that consumption accounts for 70% of U.S. GDP, that by itself would have produced a -2.25% growth rate for real GDP if all the other components of GDP had held constant. Plumeting consumer confidence [1], [2], the end of mortgage equity withdrawal and a worsening employment situation were presumably responsible for the fall in consumption spending. Housing continued to be a drag on the economy-- what else is new?-- contributing

...