Tag Archives: GDP

Economic Growth Passes Previous Record for Duration

The economy broke a record at the end of June when it surpassed the previous longest period of growth of 120 months, or ten uninterrupted years.

The previous record was set when the US economy didn’t stop growing from March 1991 until March 2001 during which time the average annual real GDP grew by 3.6%. The record-breaking growth we are in now began in June 2009, and is still expanding, although the average annual real GDP has only been 2.3%.

The previous expansion that ended in March 2001 came to its unhappy end when the dot-com bubble burst.

Compared to other expansions, which were far shorter, growth was faster. For instance, during the 45-month expansion from October 1949 until July 1953, the economy grew by 6.9%. Between April 1958 and April 1960, the economy expanded by 5.5%.

Studies have shown that the expansion has not benefited all Americans equally. Steven Pressman of Colorado State University, a professor of economics who is concerned with income inequality, says that 60% of economic gains have benefited the top one percent of the population.

One example Pressman cites are the salaries of schoolteachers. Adjust for inflation, their incomes declined in 2018, by about 0.3%. During the same time period the median pay for top CEOs in the US, including non-salary compensation, climbed by 65%, adjusted for inflation between 2009 and 2018.

Sales Drop While Business Inventories Rise for Second Consecutive Month

Inventories up, sales down in  October and November
Inventories up, sales down in October and November

The Commerce Department announced on Wednesday the US business inventories rose during the month of November while sales fell for the second month in a row.

Business inventories grew by 0.2 percent, a figure that is consistent with the expectations of economists.  The number also followed a similar gain in October.

Inventories are an important part of the total gross domestic product. Excluding cars, retail inventories went up by 0.1 percent after posting a gain of 0.3 percent in October.

In November sales shrunk by 0.2 percent and 0.3 percent in October. It would take approximately 1.31 months for businesses to clear their shelves is sales continued at November’s tempo.