First Quarter GDP, Third Estimate: Negative 2.9%

Ace:

It was cold in January, you see. Unexpectedly. It just snuck up on us.

Kratatoa noted in the sidebar that “even Reuters can’t spin this.” Well, they do give it a go, trotting out the “but the economy has grown like gangbusters since then!” spin they’ve offered since the first estimate of the first quarter GDP, back in April.

Every news outlet bought into the report’s spin, even Fox:

Economists say most of the factors that held back growth in the first quarter have already begun to reverse. Most expect a strong rebound in growth in the April-June quarter.

Apparently this nonsense is based upon other findings in the report (which has since been revised way down, twice). So, consumer spending increased by 6% in March. So, in March, people spent more after not spending as much in the cold winter.

From these data they derive the prediction: The economy is going to be doing great in the second quarter!

No matter how many times they revise down the January to March headline figures, these guys continue claiming that the first-draft estimates for a single month (March) are where the real story is.

And so it continues:

The U.S. economy contracted at a much steeper pace than previously estimated in the first quarter to record its worst performance in five years, but there are indications that growth has since rebounded strongly.The Commerce Department said on Wednesday gross domestic product fell at a 2.9 percent annual rate, instead of the 1.0 percent pace it had reported last month.

While the economy’s woes have been largely blamed on an unusually cold winter, the magnitude of the revision suggests other factors at play beyond the weather.

Now, should they be continuing to rely on those secondary numbers about consumer spending and such?

Seems not:

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