Update: Suspicious: GDP Going "Through the Roof"
The Claim
Note: On 10/19/2020, Misbar published the article "Suspicious: GDP Going 'Through the Roof.'" Since then, we have received more recent data. The updated information will be in italics.
The U.S. GDP is going "through the roof."
News posted on
Emerging story
On October 15, 2020, President Trump hosted a town hall event in Miami, Florida to answer questions and boost his chances for re-election. During the event, President Trump claimed, “GDP is going through the roof.” The claim was then commented on and shared across social media.
Misbar’s Analysis
When talking about the GDP, President Trump was referring to the Gross Domestic Product. According to Misbar’s investigation, the GDP measures the monetary value of final goods and services produced in a country in a given period of time. It counts all of the output generated within the borders of a country. According to the International Monetary Fund, when the GDP is growing, especially if inflation is not a problem, workers and businesses are generally better off than when it is not. In the U.S., the Department of Commerce’s Bureau of Economic Analysis releases the GDP data quarterly. The last release was September 30, 2020 and the next release will be October 29, 2020.
The 33% GDP decrease in the second quarter reflected the response to COVID-19, as “stay-at-home” orders were issued in March and April. This led to rapid shifts in activity, as consumers and businesses canceled, restricted, or redirected their spending.
The third quarter GDP numbers will be announced just days before the presidential election. There are some who are projecting the GDP will grow in the third quarter since many of the lockdowns have been lifted. In one forecast made by a group of nearly 80 economists, they are projecting the GDP will make a big rebound when third quarter numbers are released. And, according to CNBC, Goldman Sachs economists said they recently raised their third quarter GDP growth forecast to 35% from 30%, and they say consumer spending was a big reason for their above consensus forecast.
As of October 30, 2020, the GDP jumped 33.1%, much higher than the previous post-World War II record, which was a 16.7% growth burst. While we are still in a coronavirus-induced recession, the GDP growth can be said to be "through the roof."
