Long Term Perspective
GDP measures total domestic production quarterly. Final sales reflect demand by consumers, businesses, and government. When final sales grow much faster than GDP for at least two quarters, it signals the need to rebuild inventories. That means production increases and so does GDP. Notice that over the long run, real final sales and real GDP grow by roughly the same magnitude.

Short Term Perspective
Real GDP grew at a 4.0 percent in the third quarter while final sales rose at a 3.5 percent rate. Consumption expenditures expanded rapidly during the period; business fixed investment declined in the third quarter due to a plunge in construction spending. Investment in equipment and software increased for the second straight quarter. Residential investment continued its climb. Inventory building has begun, but at a slow rate. All in all, growth was subpar for a recovery, but improvement is on its way.

Real GDP vs. Final Sales   •   Real Consumer Spending vs. Real Income   •   Debt Burden vs. Savings Rate

Business Fixed Investment vs. Net Cash Flow   •   New Orders   •   Housing Starts vs. Mortgage Rates

Merchandise Exports vs. Trade Weighted Dollar   •   Merchandise Imports vs. Trade Weighted Dollar