The first quarter of this year has left many economists and investors scratching their heads over how the U.S. economy has been doing and other economies around the world. Apparently the method in which economists at the Bureau of Economic Analysis use to determine the growth rate of the economy is faulty. They don\u2019t take into account the economy\u2019s seasonal ups and downs. This means a harsh winter which keeps would-be shoppers at home instead of shopping is ignored even though this is an important factor. If people are unable to go out and shop due to inclement weather then of course the economy may look worse, but the reality is people will make up for their lack of shopping in the next quarter.<\/p>\n\n\n\n
A growing number of economists say there is a more reliable measure for measuring economic growth and the research conducted so far proves as much. This measure involves adding up and finding the total of each dollar spent across the entire economy. Additionally, since every dollar someone spends is a dollar of income for someone else, theoretically you can measure the size of the economy by combining everyone\u2019s income. Then you can compare the two numbers, total income and total dollars spent and they should be equal. This alternative method is known as gross domestic income (GDI) and it says the U.S. economy grew 1.4% during the winter instead of contracting .7%; that\u2019s a heck of a lot better news.<\/p>\n\n\n\n