« Citi and Feds Reach Deal | Main | Puzzling Quote of the Day »

The Feds just revised fourth-quarter GDP to -6.2% from its earlier estimate of 3.8% growth. This was the worst quarter since 1982; although the current quarter might be worse.

Output fell 6.2 percent at an annualized rate in the fourth quarter of 2008, revised downward from a previous estimate of a 3.8 percent decline. The drop was even steeper than many economists had feared, and was much lower than the 0.5 percent contraction from the previous quarter.

The announcement comes on the heels of a new budget from the Obama administration that assumes what some economists have called an unrealistically optimistic view of the near-term future of the American economy.

The downward revisions came primarily because of a larger-than-anticipated contraction in inventories of unsold goods. A wider trade gap than previously reported — that is, fewer American goods being purchased abroad — also pushed G.D.P. downward. Lower consumer sales sliced off some of the previously reported economic output, as well.

Posted by edelfenbein at February 27, 2009 9:25 AM