It was looking all good for the last six years. Nearly hitting 4.0% GDP growth, every quarter had at least positive growth for every quarter for years. And in the last quarter of 2019, the general trend of the GDP growth was still pretty strong at 2.1% (albeit a bit slow). However, this quarter took a huge turn for the worse. GDP growth wasn’t higher than 2.1%. It wasn’t positive, or even zero. Our GDP shrunk by 4.8%. 

Our GDP has shrunk by a magnitude this large before, however. So when was the last time something like this happened? Well, in the first quarter of 2009, the GDP shrank by 4.4%. That was around the time of our last recession, or the Great Recession. Obviously, that’s a bad omen for the future. 

Here’s some even worse news. It’s not going to get better anytime soon. We were just weeks into this total economic shutdown when we yielded this economic downturn. Unless things suddenly take a turn for the better, which does not look like is going to happen anytime soon, the second quarter cannot be better than the first quarter. Our GDP will decline more because economic activity will still be halted in the coming months. 

For our economy to be considered as in a state of recession, there must be two consecutive quarters where the GDP growth is negative. So, that’s one quarter down. And with the way things are going right now, it will probably be two quarters soon; it’s pretty much safe to say we’re heading into a recession as we inch towards a presidential election. 

And not even the experts predicted the magnitude of this downturn right. They were predicting a negative quarter, yes. However, they thought that the GDP growth would be somewhere around -3.5% to -4.0%. -4.8% sounds close to their estimates, but it’s actually 20% higher than the upper end of that estimate. And because of potential data errors, which likely led to an overestimation of the GDP growth during the Great Recession, this quarter and the quarters to come may end up being even worse than they look.

Things are not looking good at all. No matter how fast the economy reopens, the next few months are, economically speaking, guaranteed to be some rough ones for the United States.