🤨 Blech, we’re halfway to a recession. But a deeper dive finds some good, pro-progress news in those Q1 GDP numbers.
Also: 5 Quick Questions for … journalist Jimmy Soni on Elon Musk, Peter Thiel, and the founding of PayPal
In This Issue
The Essay: Blech, we’re halfway to a recession. But a deeper dive finds some good, pro-progress news.
5QQ: 5 Quick Questions for … journalist Jimmy Soni on Elon Musk, Peter Thiel, and the founding of PayPal
Micro Reads: CRISPR and babies, why building clean energy is hard, solar power on Mars
Quote of the Issue
“[W]hoever could make two ears of corn, or two blades of grass, to grow upon a spot of ground, where only one grew before, would deserve better of mankind, and do more essential service to his country, than the whole race of politicians put together.” - Jonathan Swift, Gulliver’s Travels
The Essay
🤨 Blech, we’re halfway to a recession. But a deeper dive finds some good, pro-progress news.
I prefer when “the line goes up” on a chart, at least when that line represents higher economic growth. And especially when growth is expected. But the line went down during the first three months of this year. We got a surprise contraction rather than another period of expected expansion.
The US economy shrank for the first time since 2020 in the first quarter. Gross domestic product, adjusted for inflation, fell at a 1.4 percent annualized rate following a 6.9 percent pace at the end of last year, according to the Commerce Department’s preliminary estimate released this morning. The consensus forecast was looking for a 1 percent increase.
And so we’re halfway toward a recession, at least if you use the definition of a downturn as consecutive quarters of shrinkage. Now a recession is not the current expectation. Wall Street is looking for a rebound. (Back in 2014, a negative 1.4 percent quarter was followed by six years of growth.)
But as we just saw, Wall Street smarties can get it badly wrong. And we should hope they do. A recession is never good, but getting one at this moment would be a gut punch as we continue to recover from the pandemic. So, thankfully, there is some good news to be had.
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