No surprises today: GDP in the third quarter grew significantly:
The chart above is the normal look at GDP growth, but since the last two quarters featured such unusual behavior it might be better to take a different kind of look:
Give or take a bit, we’re still about $1 trillion below where we’d otherwise be, so the effects of the coronavirus are very definitely still with us.
In other news from the BEA release, personal income was down by half a trillion dollars and personal savings were down by $2 trillion. The drop in income was due to the end of pandemic relief programs, and the drop in savings was due to families drawing down their savings to make up for lost income. Roughly speaking, families used part of the money from the CARES Act to bolster savings and then started spending it down when that assistance ended.
The Q3 increase in GDP was driven entirely by the private sector, led by big increases in purchases of durable goods and commercial equipment. The federal government did nothing to help, decreasing its spending thanks to the end of the CARES Act.