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The US economy has some catching up to do.
On Thursday, the Bureau of Economic Analysis announced that the US economy contracted by 32.9% in Q2, marking the worst quarter in the history of the American economy. So, I guess we’re not going out this weekend?
For comparison, between January and March, the US’ GDP only fell 5%, and hasn’t fallen by more than 10% on an annualized basis since we started keeping track after WWII. Remember that one? In the months prior to Q1, the economy had actually grown by 2.4%. So we’re trending negative…got it.
Unemployment numbers didn’t exactly scream “we’re gonna make it.” 1.43M Americans filed for unemployment benefits during the week ending July 25th, marking the second straight rise in weekly unemployment applications, and the 19th week in which more than 1M Americans filed for unemployment. Until last week, application numbers had dropped for 15 straight weeks.
On the bright side, economists predicted that we’d have 1.45M new unemployment apps. So we’re exceeding expectations? That’s good.
Things were going well, but it’s going to take us a while to get out of this little pickle we’re in, according to economists. Companies, amid the new spike in virus cases, had already cut production to meet a lack of demand, so there’s not much supply to sell to those (rare few) demanding it. As that happened, the inflation rate fell to 1.9%, pointing to a long, drawn-out recovery process.
Things were looking up, with estimates of the GDP expanding at an 18% annual pace from July to September, but that was before Florida opened the bars and the Chainsmokers had that concert in the Hamptons.
Water Cooler Talking Point(s)
💧 “At this point, let’s just chalk this year up as a loss and try again in 2021.” (AJ, The Water Coolest HQ)
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