The U.S. economy surged in the fourth quarter growing at 5.7 percent. The growth exceeded the expectations of economists, who predicted a 4.8% growth in a survey last fall. This also marks the fastest growing quarter since
2003. Does this mean the economy's roaring back to life? Is job growth
on the way? Business writers are welcoming the news, though with a few caveats.
- Uncork the Champagne! smiles Edward Harrison at Credit Writedowns: "This is a big number and it means a technical recovery IS indeed at hand. You don’t get 5.7% in a recession."
- Unequivocally Good News, celebrates Jack Ablin, Chief Investment Officer at Harris Private Bank in Chicago: "Wow, great number. It's very solid and gives us a running start into the second half of the year when we can't rely on government stimulus. That's part of the plan, to get us moving as fast as possible so when life support is removed we'll have a pulse.
- Don't Get Carried Away, This Was an 'Inventory Bounce,' writes Steve Mufson at The Washington Post: "Many economists ... warn against reading too much into a jump in GDP figures for the last three months of 2009. Ed Yardeni, president of Yardeni Research, said that even if there were no change in final sales of goods, the GDP figures would show a 4 percent increase simply because businesses that were emptying their warehouses a year ago are now buying enough goods to keep stockpiles steady."
- Too Early to Say for Job Outlook, writes Matthew Yglesias at Think Progress: "5.7 percent is a very good number. If we could sustain something like that for a little while then we’d start to make progress on the labor market. But the worrying thing here is that so much of the growth represents inventory shifts. The recession left firms with large excess inventories, then we had a few quarters in which inventory draw-down impeded growth, and what we saw in Q4 was the end of that process."
- What to Watch for Next A Daily Kos economics blogger says: "What everyone is watching is sustainability. If gas prices go up too
much, or as the effect of last year's stimulus plan begins to wane, can
gains be sustained? And noboby is talking about declining unemployment
yet. On that, the jury is very much out."