US Economy Exceeds Expectations in 3rd Quarter; However, Income Numbers Paint a Different Picture
by Emmitt Barry, Worthy News Correspondent
(Worthy News) – According to the Bureau of Economic Analysis’ second estimate on Wednesday, real U.S. gross domestic product (GDP) grew by 5.2% in the third quarter of 2023. However, the figures are somewhat skewed, as the real gross domestic income (GDI) rate only increased by 1.5%, indicating that the U.S. economy only expanded moderately.
Financial analysts have highlighted the significant discrepancy between Gross Domestic Product (GDP) and Gross Domestic Income (GDI), suggesting that the numbers are manipulated to portray a robust economy, contrary to the widespread reporting indicating otherwise.
“No sign of darkening skies for the economy in today’s report, but growth is cooling,” said Christopher Rupkey, chief economist at FWDBONDS in New York, told Reuters. “There’s simply not as much wind in the economy’s sails in the final quarter this year.”
Financial Analyst Mike Shedlock, addressing the discrepancy between GDP and GDI, remarked, “The numbers should match and do correlate over time. But the difference between the measures is stunning.” Shedlock concluded, “Based on GDI, a very reasonable case can be made that the economy went into recession and/or is still flirting with recession. Nonetheless, expect a bunch of glowing comments today on how great this economy is.”
Some economic analysts highlighted the substantial growth in government spending, which increased at an annual rate of 5.5%, contributing to the overall GDP figures.
Users shared a chart on social platform X depicting the gap between GDP and GDI numbers, highlighting the most substantial disparity between the two figures. Some drew parallels to a similar occurrence in 2007, just before the crash of 2008.
Nevertheless, the 5.2 percent pace of expansion recorded in the third quarter was the swiftest since the fourth quarter of 2021, beating analyst expectations marking an increase from 2.1 percent in the second quarter. An upswing in consumer spending and private inventory investment primarily drove the acceleration in third-quarter GDP.
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