Looks like the UCLA Anderson economics team finally figured out the GDP is broken and is counting all American companies product output as if it is produced in the USA.
The question is, does the Bush white house keep spewing the erroneous numbers in an attempt to trick people into thinking we really have 8% GDP, or do they fess up and admit the figures are bad.
3% GDP in 04 sounds about right, which isn't terrible, but when you have 8-9 million unemployed + underemployed, it aint great either. These economists are looking for one million jobs created in 04, not even 100K/month.
UCLA Forecast: Growth About 3 Pct in '04
Edward Leamer, the director of the UCLA Anderson Forecast and one of the first economists to flag the most recent recession, said the sustained surge in U.S. growth next year that some Wall Street analysts expect will not emerge.
Instead, the economy will grow at a rate of 2.5 percent to 3 percent in 2004, rather than the 4.5 percent to 5 percent pace typical of normal rebounds from recession, Leamer said.
"We should get about a 1 million new jobs over the next year. But the unemployment rate sticks around the 6 percent level," Leamer said, adding that will give the Federal Reserve reason to keep interest rates down.
That slower growth, the result in part of the pressure on household balance sheets and local government budgets, will not do much to lower the unemployment rate, he added.
Higher productivity made the third quarter "feel like a Twilight Zone episode" as a blistering 8.2 percent rise in the economy was paired with a weak job market, Leamer said.
"The data are so unusual with all that economic growth and no employment," Leamer said. "It's some kind of mysterious force out there delivering products to our door."
For instance, there is reason to expect a pullback in spending by consumers as well as state and local governments will emerge as drags on the economy, Leamer said.
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