This is not too much of a surprise: The American economy shrank at a 4.8 percent annualized pace in the first quarter, according to numbers out from the Commerce Department this morning. The downturn was led by the steepest drop in consumer spending since 1980 and the fastest decline in business investment in almost 11 years.
The first quarter marked the first negative GDP reading since the 1.1 percent decline in the first quarter of 2014. It was the worst overall quarter since the 8.4 percent plunge in the fourth quarter of 2008 during the worst of the financial crisis. And remember, it wasn't until March that the shutdowns began.
Consumer spending, which makes up 67 percent of total GDP, plunged 7.6 percent in the quarter as all nonessential stores were closed and the cornerstone of the U.S. economy was taken almost completely out of commission. Durable goods spending tumbled 16.1 percent while expenditures on services were down 10.2 percent.
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