Friday, February 27, 2009

Bull Trip: GDP Report Q4 2008 (Preliminary)

Today, the Bureau of Economic Analysis (BEA) released second installment of the Q4 2008 GDP report showing a stunning contraction with GDP declining at an annual rate of -6.2%.

Looking at the report more closely it’s easy to see that the quarter was a disaster overall with huge double-digit declines to Durable Goods, Imports (actually a benefit) and Exports as well as Fixed Investment.

Fixed investment provided significant drags on growth with non-residential investment declining -21.1% and residential investment declining -28.8%.

The following chart shows real residential and non-residential fixed investment versus overall GDP since Q1 2003 (click for larger version).