{"id":56568,"date":"2021-01-30T12:49:26","date_gmt":"2021-01-30T17:49:26","guid":{"rendered":"https:\/\/olduvai.ca\/?p=56568"},"modified":"2021-01-30T12:49:26","modified_gmt":"2021-01-30T17:49:26","slug":"the-year-of-the-plague-in-charts-weirdest-economy-ever","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=56568","title":{"rendered":"The Year of the Plague in Charts: Weirdest Economy Ever"},"content":{"rendered":"
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The Year of the Plague in Charts: Weirdest Economy Ever<\/a><\/h3>\n<\/header>\n
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GDP fell by 3.5% in the year 2020, the worst annual decline since 1946. Trade deficit in Q4 hit new all-time worst.<\/strong><\/p>\n

The size of the US economy, as measured by GDP in \u201ccurrent dollars\u201d (not adjusted for inflation), fell to $20.9 trillion in the year 2020, according to the\u00a0Bureau of Economic Analysis<\/a>\u00a0this morning.<\/p>\n

In the discussion below, you will see inflation-adjusted figures, with adjustments being made based on \u201c2012 dollars.\u201d In these 2012 dollars, GDP fell by 3.5% in the year 2020, the worst annual decline since 1946 (when it plunged by 11.6%).<\/p>\n

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In the fourth quarter, GDP grew by 1.0% from the third quarter, adjusted for inflation (but not \u201cannualized\u201d), which left Q4 GDP still down 2.5% from a year ago.<\/p>\n

The plunge in Q2 and the jump in Q3 were the sharpest moves ever in the quarterly GDP data, which began in 1947. Before then, there were only annual data. Q4 growth, at 1% (green column), is back in the normal quarterly growth range over the past two decades:<\/p>\n

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In the headlines this morning, you saw \u201c4%\u201d GDP growth for Q4, which was an \u201cannualized\u201d figure, meaning Q4 growth (1.0%) multiplied by four to project what the growth would be if it continues for an entire year at the same rate, which is kind of silly, but that\u2019s what \u201cannualized\u201d growth rates do. And they sure make things look bigger.<\/p>\n

Adjusted for inflation via these infamous \u201c2012 dollars,\u201d GDP in Q4 amounted to a \u201cseasonally adjusted\u201d \u201cannual rate\u201d of $18.8 trillion, same where it had been in Q4 2018:<\/p>\n

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Consumer spending (69.5% of GDP) edged up just 0.6%<\/strong>\u00a0in Q4 from Q3 to an annual rate of $13.0 trillion in 2012 dollars. And it was still down 2.6% from Q4 last year:<\/p>\n