The 2nd quarter bump was the $300 billion stimulus (annualized at 1.2 trillion). That was nothing but borrowing from future GDP.
Possibly, although I really don’t see how a stimulus which was passed in the second quarter could have much effect in the second quarter. As I said in an earlier post, there is a delay between what the government does and what the economy does.
But irrespective, the fact remains that it is not as bad as you’d think listening to the media. This is not a Depression.
When you look at all the statistics, the one that most closely resembles what happened during the Depression is the stock market crash. But even that is not that comparable. The stock market declined by 90% during the Depression. So far, the Dow is down less than 40%. And even that is misleading on the high side. During the Depression, the 90% decline set investors back to the levels they had in 1910 or thereabouts. Right now, we are at 2003 levels. The 40% number ignores that between mid 2005 and October, 2008, there was an increase of almost 40%. If you did not buy at the peak in October, 2008, and you were properly diversified, then your losses are probably less than 40%.
And of course, the stock market is not the same as the economy anyway.
We’ve got 6.7% unemployment and a decline of GDP that is a fraction of a percent. That’s wildly different from what you’d expect in a Depression.