Slowing Down

   As noted here a month ago, the U.S. economy is big, but it's not big enough to carry the rest of the world, and we posted a warning of a slowdown as the nation's output of goods and services slid from an increase of 2.2 percent in the fourth quarter to barely rising in the first quarter of 2015.
   The initial estimate for the beginning of the year was 0.2 percent, according to government reports. Now comes a second look, and GDP growth went into negative territory for the first quarter, registering a 0.7 percent dip.
   Does this mean another recession? Maybe, but we won't know for several more months, since by definition, it takes two consecutive quarters of negative numbers to qualify as an economic downturn. However, after showing real GDP growth of 2.2 percent in the fourth quarter of 2014, then slipping to hover around the zero mark for the first quarter of this year, one has to wonder.
   Meanwhile, corporate profits fell again in the first quarter, according to the government's Economics and Statistics Administration. Profits from current production decreased $125 billion in the first quarter, following a decrease of $30.4 billion in the fourth quarter.
   Productivity growth in America continues to fade, according to an analysis from the International Monetary Fund. The slowdown began some ten years ago, before the Great Recession, the IMF said. And while some blame the change on the information technology industry, the IMF working paper said the slowdown in growth was more widespread, reflecting "a loss of efficiency" over the last two decades. Even so, the states with better education as well as greater investment in research and development do better, the IMF said.