Krugman: Less than meets the eye in GDP report
The NYT columnist's post on the question of whether it's a recession:
I’ve had time to look at it a bit more closely — and it’s much weaker than the headline number suggests (and MUCH weaker than the previous quarter, even though the growth rate was the same.) It’s not just that final sales fell, so that the economy grew only because of inventory accumulation. If you look at consumer spending, purchases of goods actually fell substantially. Only service purchases rose — and much of that was housing and medical care.
For examples of inventories climbing faster than sales, see here and here.
