A Sign of Economic Progress

Posted on by Karina

Today, the Bureau of Economic Analysis released an advanced estimate showing the GDP increased at an annual rate of 5.7% in the fourth quarter of 2009:

Gross Domestic Product Increases by 5.7 percent

Economists react to the fastest GDP growth in six years:

Mark Zandi, chief economist at Moody's

I think stimulus was key to the 4th quarter. It was really critical to business fixed investment because there was a tax bonus depreciation in the stimulus that expired in December and juiced up fixed investment. And also, it was very critical to housing and residential investment because of the housing tax credit. And the decline in government spending would have been measurably greater without the money from the stimulus. So the stimulus was very, very important in the 4th quarter.

Bernard Baumohl, chief global economist at the Economic Outlook Group:

I’m very impressed with what I’ve seen. The skeptics of the economic recovery are going to have some explaining to do.

Jack Ablin, chief investment officer at Harris Private Bank in Chicago:

Wow, great number. It’s very solid and gives us a running start into the second half of the year when we can’t rely on government stimulus. That’s part of the plan, to get us moving as fast as possible so when life support is removed we’ll have a pulse.

Bruce Kasman, chief economist at JPMorgan Chase & Co:

We are getting on to something that is pretty sustainable. Both consumers and businesses are beginning to increase spending. To get validation, we need to see a return in hiring, which we think we are going to get over the next few months.

Mark Gertler, New York University economist:

We can be a bit more optimistic that a sustainable recovery is indeed underway.

Speaker Pelosi on the news:

Today's GDP numbers are a sign of economic progress, marking another step forward on the road to recovery and job creation, clear evidence that our efforts to revitalize the economy are starting to pay off.

From the first days of the 111th Congress, we have worked to create and save jobs, help small businesses, restore opportunity and economic security to the middle class, and lay a stronger foundation for the future. Economists of every stripe agree that our actions helped avert even greater economic catastrophe — from the Recovery Act and Cash for Clunkers to the first-time homebuyer tax credit.

Despite today's good news, millions of Americans remain out of work and still struggle to make ends meet. Moving forward, we will continue to place jobs and our middle class at the center of our agenda — by completing work on initiatives that help small businesses start hiring, invest in infrastructure, create 4 million new jobs with affordable health care, create clean energy jobs, and protect Main Street from the recklessness of Wall Street.

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