Zerohedge reports on the latest GDP numbers:
So much for the US recovery (we will never tire of saying that). After the first Q2 GDP revision bubbled up from 1.5% to 1.7%, the sellside brigade was confident that the rate of growth would continue and final Q2 GDP would be in line. Instead, we got an absolute shock of a print, with the final Q2 GDP print coming in at a ridiculously low 1.25% (rounded up to 1.3%), below the lowest Wall Street estimate of 1.4%, and the lowest number since the revised 0.1% reported in January 2011. Here is the final GDP trendline: Q4 2011: 4.1%; Q1 2012: 2.0%; Q2 2012: 1.25%.
This is bad news. And politically it's bad news for President Barack Obama, at least that's what former Obama administration economist Austan Goolsbee predicted in January.
"I would say, if the economy's growing the way it did in 2010, or is...3 percent and above, the president is going to have major wind at his back," Goolsbee said on a Sunday show in January. "If it's growing less than 2 percent or if things go wrong in Europe, he's going to be facing trouble. But we're somewhere right now, splitting the difference, and so we're going to be in this -- in this close spot."