November 3rd, 2011 
Jonathan Dionisio 
Finally, naysayers, forecasters and practically anyone who has been stressing that a double-dip recession is around the corner can pipe down – for now.
Gross domestic product (GDP), the broadest measure of U.S. economic health, grew by 2.3 percent during the third quarter as consumers and businesses increased spending. This was almost 50 percent higher compared to Q2 GDP results of 1.3 percent and way above the 0.4 percent growth in Q1. Only a month ago, the economists had been forecasting a mere 1.9 percent growth for the quarter.
"The economy has shed fears of a double-dip recession," said Sung Won Sohn, economics professor at Cal State University-Channel Islands, who said growth is no longer "stuck in neutral going nowhere fast".
Based on the Commerce Department report, real GDP in the third quarter primarily reflected positive contributions from personal consumption expenditures, nonresidential fixed investment, exports, and federal government spending that were partly offset by negative contributions from private inventory investment and state and local government spending. Imports, which are a subtraction in the calculation of GDP, also increased.
Consumer spending jumped 2.4 percent compared with an increase of 0.7 percent last quarter. Durable goods increased 4.1 percent, in contrast to a previous decrease of 5.3 percent. Services increased 3.0 percent, compared with a previous increase of 1.9 percent. Non-residential fixed investment increased 16.3 percent from 10.3 percent. Businesses also spent more, as investment in equipment and software, a good barometer of that reading, climbed to a 17.4 percent rate.
"The economy is now heading in the right direction and this is very encouraging, particularly given the heightened global uncertainties and the fact that other major economies appear to be heading into recessions," said Millan Mulraine, a senior macro strategist at TD Securities in New York.
Some economists feel that the country cannot sustain this growth given the rest of the problems that are hurting the economy. These include the struggling housing industry, unemployment, consumer sentiment, and even the European debt crisis. However, bullish economists said that there are reasons to be encouraged and look ahead to a better fourth quarter.
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Sources:
http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm
http://money.cnn.com/2011/10/27/news/economy/gdp_report/index.htm
http://www.reuters.com/article/2011/10/27/us-usa-economy-idUSTRE79O4A620111027
http://money.cnn.com/2011/10/24/news/economy/gdp_forecast/index.htm
http://online.wsj.com/article/SB10001424052970203554104577001513470146048.html
http://www.nytimes.com/2011/10/28/business/economy/us-economy-shows-modest-growth.html
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