More Which Way Is Up Problems

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Sunday, 11 August 2013 19:23

An Associated Press article in the NYT told readers about Japan's "sluggish" growth in the second quarter. The article told readers that Japan's economy grew at a 2.6 percent annual rate in the quarter.

The problem is that the media generally touted the 1.7 percent annual growth in the U.S. in the second quarter as a being positive news. It's difficult to see how a 2.6 percent growth rate in Japan can be seen as sluggish while a 1.7 percent growth rate in the United States is healthy, especially since Japan has a declining population and labor force, while ours is growing at roughly a 0.7 percent annual rate.