GDP revisions are out

GDP stats came out for Q2. I’ll get to that in a later post. We had 1.9% growth on the quarter, which was a decent lift from the stimulus package.

But, what is really interesting is that the Bureau of Economic Analysis (BEA), which does the GDP statistics also released revisions of the GDP data back to 2005. The BEA makes these revisions annually and released this statement with their GDP report today:

The revised estimates, which begin with 2005, reflect the results of the regular annual revision of the national income and product accounts (NIPAs). These revisions, usually made each July, incorporate newly available and more comprehensive source data, as well as improved estimating methodologies. In this annual revision, the notable revisions primarily reflected the incorporation of
newly available and revised source data. For example, the revised estimates of profits reflect newly available Internal Revenue Service tabulations of tax returns for corporations for 2006 and revised tabulations for 2005.
BEA GDP Report, 31 Jul 2008

In any event, here are the headline numbers:

Notice, every single quarter’s GDP was revised down. We’re talking tens of billions of dollars.

The real GDP numbers also saw a revision to -0.2% in 2007 Q4 from +0.4%, effectively confirming December 2007 as the likely start of the recession. All of this is a good reason we should not take the happy talk on GDP at face value. I wonder what the statistics will show about 2008 when all is said and done.

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