July 31st, 2009
01:39 PM ET

Financial Dispatch: Recession may be letting up

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Andrew Torgan
CNN Financial News Producer

The pace of economic decline slowed substantially in the second quarter, as the U.S. economy shrank at an annual rate of 1% - far less than it did in the first quarter.

Gross Domestic Product, the broadest measure of economic activity, has now contracted for four straight quarters - the first time that’s happened since the government began tracking that measure in 1947.

But the most recent decline is the smallest since the third quarter of 2008, giving hope to some economists that the recession that began in December 2007 is nearing an end.

Washington scrambling to save “Cash for Clunkers”

This much seems certain about the government’s new “Cash for Clunkers” program: Consumers are happy to take government rebates to buy new cars.

Other than that, confusion reigns.

The fate of the $1 billion trade-in program is up in the air over concerns that it may have already burned through its funds less than a week after it was officially launched. And it was unclear how much longer car buyers would be able to trade in clunkers after reports surfaced on Thursday night that the program would be suspended.

Earlier today, the Obama administration said it was working with Congress to try to get more money and that “Clunkers” deal certificates would be honored at least through the weekend.

40 med school students getting free ride

The incoming freshmen at one of the nation's newest medical schools will have more freedom to choose whether to become a specialist or help fill the shortage of primary care doctors.

That’s because the students at the University of Central Florida in Orlando will be graduating 100% debt free.

All 40 students of the charter class that begins Monday have received full scholarships totaling $7 million, donated entirely by members of the community - including individuals, hospitals, banks and law firms.

Follow the money… on Twitter: @AndrewTorganCNN

Filed under: Andrew Torgan • Economy
soundoff (11 Responses)
  1. truthislove45

    Great point about birth rates and marriage! Hopefully people seek GOd rather then the gov who pushes devoid of wisdom agendas! This nation is reaping from it has sown and Obamas stealingfromya agendas are only a bandaid!

    August 1, 2009 at 2:39 am |
  2. nea-nea

    I pray it continue to improve!

    August 1, 2009 at 1:39 am |
  3. Marshall Willis Jr.

    I work for a corporation of John Deere (lawn mowers) and we were losin the battle at the beginning of the year , well we came off $200 on the price and started givin a $200 wagon with the mowers for free and we went to overtime. I believe that and Cash for Clunkers is two very good examples that there is money out there but we are lookin for deals. I think if we can get our credit out there and get consumers spendin then we are gonna be just fine. But we need REAL DEALS out there I wont speak the name but i went and bought a pair of jeans at a local franchise store one week before they announced that they were closin the whole franch and they were on a really good deal lol i dont want to sound cheap but i bought them for $15 that night, well i go there cause they are announcing 60 and 70 percent off and i was gonna go and buy more and i go up there and that same pair for 15 was 45 that i had just bought a week ago. Come on , at least most people aint stupid, give a real deal and NO it wasn't just that pair ,I looked around both times and everything in there was lol NO REAL DEAL. I think maybe they didn't do enough advertising cause I also thought $15 was a great deal. Bottom line is these banks are gonna have to give loans and quit takin advantage of everyone and the suppliers of probably all or at least most goods are gonna have to put good sales out there.And one more thing Sorry so long just one more sentence. I had a credit card that had a 9.99 % rate and the bank sold to CHASE and as soon as that happened I then had 18.49% rate.

    July 31, 2009 at 11:28 pm |
  4. WD

    In my mind, if unemployment is on the rise, things are not getting better. Historic spending and and raising taxes is not a good sign for things to get better. If we keep spending the way we are, China is going to cut us off. Then what? Inflation, even more taxing. Bottom line, congress needs to actually read these important and expensive bills and do what the people elected to do. If they do what they did with the last so called stimulus package, we have some dark days heading our way. I'm not being pessimistic, I'm being REALISTIC.

    July 31, 2009 at 10:57 pm |
  5. Annie Kate

    How great that those 70 med students graduated loan free from med school. I wish more good things like this would happen all over the country. The one thing that troubles me though is that we are helping doctors who will make a good salary anyway and we are not helping teachers in school or post graduate; their salaries tend to be too low as well.

    Education is our key to a better future so we are told, so wouldn't it be logical to be sure that teaching as a profession is made more alluring so we can get the best and brightest into the classroom to teach the next generation and inspire them with more knowledge and skills? Lets not forget the base layer of what makes our workforce good – good education with a good teacher in a good school system. That should be everyone's birthright.

    July 31, 2009 at 8:58 pm |
  6. Heather,ca

    Living in California having watched first hand at ground zero for the past 2 years as people who had homes from every type of mortgage other than conventional stop making payments. Followed by companies laying people off because home building and buying had stopped. Followed by people losing jobs and now facing forclosure and now county after county where bulk home building and buying took place are now filing bankruptcy. Southern cal is being hit hard with record bankruptcy filings since the end of last year. People have stopped looking for jobs. There are no more jobs. Many national companies are out of business. These reports never accurately or truthfully represent the facts. The recession is far from over. Especially if the fraud and ponzi scam continues with the deregulation.
    These reports are the governments way of changing the psychology of consumer confidence. The fact is all the smart economists know the real truth which they predicted and were right. It took four or five years to get here. It will take the same to recover. The recession is not over. It just got started.

    July 31, 2009 at 5:53 pm |
  7. RLWellman

    Last week VP Joe Biden said we were in worse shape than originally thought and it would take longer to come out of the recession. This week we are doing better. Is this so we will say it is okay to pass this stupid Health Care Reform Bill?

    Why is the bill being passed without reading it again? Anyone remember the garbage that was in the 787 billion dollar stimulis bill? Here we go again, it has to be signed quick or you're not going home for recess.

    The President knows his approval rating is slipping and the opportunity to get these garbage bills signed is waning. Some people are actually starting to read these bills before they are signing or refusing to sign.

    The reform needs to be good enough that the Government will sign on first, then the rest of the country might think this is a good idea!

    July 31, 2009 at 4:34 pm |
  8. earle,florida

    Certainly looks good on the financial front. Next, GDP Qtr. could/should be very encouraging. Next pressing agenda the Obama Administration addresses is (at least I'm hoping) for immediate fixing of the "Housing Crises", with the projected estimates of 2.1million foreclosures incubating in the industry for 2009/2010. Wow,just think,we almost broke even,quite remarkable for where we were one-year ago. Yes, to medical students in Florida,finally some rational exuberance in the right direction,Bravo! Can you imagine,more practicing primary care doctors,than specialist? I was beginning to wonder if the Specialist would eventually start recommending the patients to primary care doctors,in this ubigutious world we live in today. Go President Obama,...

    July 31, 2009 at 3:17 pm |
  9. JC- Los Angeles

    If California is any indication of the precarious state of our nation, then the recession is most certainly not over but is about to head up market.

    While worthless corporate executives have jettisoned countless hard working middle class employees, the upper middle and upper classes stayed afloat through refinancing and low teaser rate mortgages.

    Now that all the option arm loans and Alt-A loans are about to reset and with equity gone in the high priced neighborhoods, the recession will pick up speed and destroy those that pushed the envelope.

    Look for birth rates to plummet and divorces to skyrocket.

    July 31, 2009 at 2:44 pm |
  10. Joanne R. Pacicca

    The concept of medical students receiving a free education will certainly contribute to driving down the cost of healthcare. Bravo!

    July 31, 2009 at 2:22 pm |
  11. Michael C. McHugh

    As a progressive Keynesian, I always KNEW we could end a depression by big deficit spending and easy money policies, as long as we spent enough. In World War II, the Depression ended in about two years because of policies like these that expanded consumer demand, created jobs, and generally stimulated the economy. By 1944, there was even a big labor shortage.

    We were not yet in as bad a shape as the economy was in 1940, although it's close enough. We certainly didn't crash out all the way like they did in 1929-33 because the federal inetvention was swift and sure, if somewhat hurried and clumsy, and putting too much money into the top level of the economy. Naturally, we weren't spending as much as the Second World War, relatively speaking.

    We may still crash out like the 1930s if there's another big shock to the system like a commercial real estate crash or an oil shock, so I wouldn't say it was all over yet, but if we're lucky it has hit bottom–and faster than I thought.

    July 31, 2009 at 2:17 pm |