Today, the Commerce Department released the economic data for the 4th quarter of 2009. At an annualized rate (the economy actually shrank by over 2% in 2009), the economy grew at a rate that would amount to a 5.7% increase in the 4th quarter.
Why be happy? Well, for one, things didn't get worse, inspite of increasing unemployment.
Why be concerned? Well, last previous quarter estimates were later revised down. Expect some downward adjustment later. Discounting the building of business inventories, the actual retail economy actually grew at a 2.2% rate. This is close to what is actually considered break even. Less than this amount it can actually be assumed the economy is not actually growing.
What to look for? If inventories grew by that much, and consumer demand doesn't pick up, it is likely thand at we will head back downward as businesses try adjust to excess inventory.
Also, the auto industry barely grew at all, coming in at 0.6 percent increase. There are a lot of old automobiles out there needing replacing.
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