South By North Strategies, Ltd.

Free Exchange offers an initial overview of the advance GDP report for the 4th Quarter of 2010.

… Well, given the size of the output gap—for now, about $800 billion separates actual and potential real output—the economy should be growing faster. For 2010 as a whole, output expanded by 2.9%. That’s the fastest growth since 2005, but at this point in the early 1990s business cycle annual growth was up (despite a smaller output gap) at a 3.4% pace, and at this point in the early 1980s cycle annual growth was roaring ahead at 4.5%. Current growth is consistent with a painfully slow reduction in the unemployment rate. Forecasters anticipate a further acceleration in 2011, perhaps to an annual rate near 4%. The jobless can only hope such predictions come true.