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U.S. Department of Commerce: Oops! The Recession Started in 2007!

Posted August 4, 2008

"The U.S. gross domestic product (GDP) report came in lower than expected yesterday (Thursday) and handed dollar bears a hidden surprise." — Chris Gaffney CFA, vice president of World Markets at EverBank

Blogger’s note: Well, that’s refreshing: A government body that actually wants to tell the public the truth. The U.S. Department of Commerce has come clean. Late last week, the department revised its GDP growth numbers for the fourth quarter of 2007, and guess what? The numbers now say that the recession started before 2008. But don’t take my word for it. Read on below to learn more about the new results for our economy.

by Chris Gaffney

Baltimore — (TFN): The U.S. gross domestic product (GDP) report came in lower than expected yesterday (Thursday) and handed dollar bears a hidden surprise (more on that a bit later).

In addition to the poor GDP numbers, personal consumption dropped and the GDP Price Index showed a decrease.

Also, the employment cost index was flat, and the weekly jobless claims were slightly higher than expected at 448,000. It doesn’t sound like a lot, but it means more Americans filed initial unemployment claims last week than anytime in the last five years.

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In fact, the only positive piece of data released in the U.S. yesterday was the volatile (and somewhat unreliable) Chicago Purchasing Managers number (it measures the "Chicago Business Barometer"). This one "positive" piece of news showed the number inched up above 50. Read on to learn why the recession started in 2007.

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