Obama Recovery: US GDP Contracts in Fourth Quarter of 2012

The U.S. economy posted a stunning drop of 0.1 percent in the fourth quarter, defying expectations for slow growth and possibly providing incentive for more Federal Reserve stimulus.

The economy shrank from October through December for the first time since the recession ended, hurt by the biggest cut in defense spending in 40 years, fewer exports and sluggish growth in company stockpiles.

The Commerce Department said Wednesday that the economy contracted at an annual rate of 0.1 percent in the fourth quarter. That’s a sharp slowdown from the 3.1 percent growth rate in the July-September quarter.

The surprise contraction could raise fears about the economy’s ability to handle tax increases that took effect in January and looming spending cuts.

Still, the weakness may be because of one-time factors. Government spending cuts and slower inventory growth subtracted a total of 2.6 percentage points from growth.

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  • Homer

    and they tried to tell us: we are on the road to recovery! what fantasy are they reading from? This nation, and this world are heading for a Spiritual, financial, and moral cliff, like none seen on this earth! As in the days of LOT, and in the days of Noah, before the great flood, all things are as they were! the ROOT cause….the Love of Money (1 Tim 6:10) and the hatred of God/Jesus Christ and His principles!! As for me, I have prepared in the ONLY way anyone can be prepared (Romans 8:28-39 KJV) Are you? 1 Peter 3:18 KJV

  • Capt.America

    It’s a miracle! Up is down and down is up.

  • kenneth mase

    please delete us from email