"One of the greatest disappointments with the U.S. economy since the turn of the century has been its consistent underperformance, not growing above an inflation-adjusted average annual rate of 4 percent since 2000, and not above 3 percent since 2005.
What has come in its stead the past 10 years is the slowest economic growth rate in U.S. history — even slower than the Great Depression.
Restoring the U.S. to 3 percent or maybe even 4 percent growth has been one of President Donald Trump’s major goals, but getting there will not be so easy.
Just take 2017.On an inflation-adjusted, annualized basis, there was 1.2 percent growth in the first quarter, 3.1 percent in the second quarter and 3.0 percent growth in the third quarter, according to data compiled by the Bureau of Economic Analysis.
So, to get to 3 percent growth for the year, we’d need 4.7 percent growth in the fourth quarter, right?
Wrong.
The actual answer would be 14.5 percent.
Why?
How is that possible?
Because annual GDP growth is calculated by the taking the four readings of the real GDP using chained dollars for two consecutive years, averaging each year out and then calculating the growth rate.
I’ll show you the work because I didn’t believe it myself the first time I worked it out — and like millions of Americans I want to see the economy start growing again robustly..."
Read on.
Amazing!
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