Yes, the economy still feels awfully dreary around here. Some economists believe California is still in a recession, and will be stuck for another few months, even if the national recession probably ended last summer or fall.
With that, it's worth noting that the national Gross Domestic Product figures are out today for the fourth quarter of 2009, and they're pretty smashing: 5.7 percent annualized growth rate.
Here's some instant analysis from an email from California economist Sung Won Sohn, of CSU's Channel Islands campus:
The good news is that the recession has ended around mid-year and the economy has begun to expand during the second half of the year. Most of the sectors has contributed to economic growth during the quarter. Final sales have increased from the second quarter.
The not-so-good news is that most of the growth came from temporary factors such as inventories and government stimulus which can't be sustained.
Consumers are doing their part in this economic recovery. The "cash for clunkers" program has boosted spending temporarily. Nevertheless, consumers seem to feel better about the future of the economy. The employment market is the main problem facing consumers and the economy. However, the job market is in the process of stabilizing with the unemployment rate topping sometime during the first half of 2010.
Capital spending has been another source of economic positivs. In this report, the spending for equipment and software has risen as businesses try to raise output by raising productivity. The Achilles' heel of this sector is commercial construction, a lagging indicator. Offices, apartments, warehouses, etc. will lag the overall economy by as much as a year or more in recovery.
As expected, housing continues to be a drag on economic growth even though we expect bottoming out sometime during the first half of the year. Net exports were another positive to economic growth during the quarter.