U.S. Economic Activity Jumps Sharply in Second Quarter 2014

Paul Dykewicz

Mark Skousen

Washington, D.C. — Gross Output (GO), a broadened measure of U.S. economic activity, advanced to nearly $30.9 trillion in the second quarter of 2014, a 4.8% annualized jump in real terms, the Bureau of Economic Analysis (BEA) reported today.

Gross Output, a measure of sales or receipts of all industries throughout the production process, includes business to business transactions, in contrast to Gross Domestic Product (GDP), which did not advance as strongly during the second quarter. GDP, which measures the value of final goods and services only, rose a slightly less robust 4.6% in real terms to reach $17,328.2 billion during the second quarter.

“The GO data demonstrates that the economy recovered sharply from the slowdown in the first quarter,” said Mark Skousen, PhD, editor of Forecasts & Strategies, who champions Gross Output as a more comprehensive measure of economic activity than GDP. He first introduced Gross Output as a macroeconomic tool in his book, “The Structure of Production,” (New York University Press, 1990). The BEA now publishes GO on a quarterly basis in its “GDP by Industry” data.

“Gross Output and GDP are complementary aspects of the economy, but GO does a better job of measuring total economic activity and demonstrates that business spending is booming and is more significant than consumer spending,” Skousen said. “By using GO data, we see that consumer spending is actually less than 40% of economic activity, not the 70% figure that is reported by the media.”

During economic downturns, Skousen said GO tends to fall faster than GDP. But during periods of economic expansion, GO rises faster than GDP, he added.

Skousen explained that GDP leaves out a big part of the economy, particularly business-to-business transactions in the production of intermediate inputs. He calculated that business intermediate expenditures (IE) jumped an annualized rate of 20% to $21.4 trillion in the second quarter.

“That’s good news for the economy and the stock market,” said Skousen, who former Republican presidential candidate Steve Forbes recently wrote should receive Nobel Prize consideration for promoting the use of the Gross Output statistic for the past several decades.

Forbes magazine featured two write-ups that bought attention to Skousen and the Gross Output statistic that he favors for economic analysis. The following commentaries address Gross Output (GO), Intermediate Expenditures (IE) and their relationship to GDP.

Steve Forbes wrote an April 14 column, “New, Revolutionary Way To Measure The Economy Is Coming — Believe Me, This Is A Big Deal.”

Mark Skousen’s Forbes magazine op-ed appeared December 16, 2013, with the headline, “Beyond GDP: Get Ready For A New Way To Measure The Economy.”

In addition, the Wall Street Journal published a Skousen commentary about GO as a lead editorial on April 23, 2014, “At Last, a Better Economic Measure.”

Skousen’s monthly investment newsletter, Forecasts & Strategies, uses his unique background as a free-market economist to make investment recommendations for his subscribers. He also writes three weekly subscription-based trading services and posts regular commentaries focused on economics, investing and politics at www.MarkSkousen.com.

To accommodate increased media attention about his pioneering work with the Gross Output statistic, Skousen has made an unusual move for an economist by retaining a press representative, Valerie Durham, reachable by phone, 1-410-570-0535, and email, vdurham@skousenpub.com, to handle inquiries.

share on:

Like This Article?
Now Get a FREE Special Report:
3 Dividend Plays with Sky-High Returns

This newly-released report by a top-20 living economist details three investments that are your best bets for income and appreciation for the rest of the year and beyond.

Get Access to the Report, 100% FREE

share on:


Dr. Mark Skousen

Named one of the "Top 20 Living Economists," Dr. Skousen is a professional economist, investment expert, university professor, and author of more than 25 books.

Product Details

  • Forecasts & Strategies
  • Home Run Trader
  • Fast Money Alert
  • Five Star Trader
  • TNT Trader

Bryan Perry

A former Wall Street financial advisor with three decades' experience, Bryan Perry focuses his efforts on high-yield income investing and quick-hitting options plays.

Product Details

  • Cash Machine
  • Premium Income PRO (exclusively for subscribers of Cash Machine)
  • Quick Income Trader
  • Breakout Options Alert
  • Hi-Tech Trader

Jim Woods

Jim Woods has over 20 years of experience in the markets from working as a stockbroker,
financial journalist, and money manager. As well as a book author and regular contributor to
numerous investment websites, Jim is the editor of:

Product Details

  • Successful Investing
  • High Velocity Options
  • Intelligence Report
  • Bullseye Stock Trader
  • Eagle Eye Opener

Bob Carlson

Bob Carlson provides independent, objective research covering all the financial issues of retirement and retirement planning. In addition, Bob serves as Chairman of the Board of Trustees of the Fairfax County (VA) Employees’ Retirement System, which has over $2.8 billion in assets.

Product Details

  • Retirement Watch
  • Retirement Watch Spotlight Series
  • Lifetime Retirement Protection Program

Jon Johnson

Jon Johnson's philosophy in investing and trading is to take what the market gives you regardless if that is to the upside or downside. For the past 21 years, Jon has helped thousands of clients gain success in the financial markets through his newsletters and education services:

Product Details

  • Investment House Daily
  • Stock of the Week
  • Technical Traders Alert
  • Rapid Profits Stock Trader


Used by financial advisors and individual investors all over the world, DividendInvestor.com is the premier provider and one-stop shop for dividend information and research.

Product Details

Popular tools include our proprietary Dividend Calendar, Dividend Calculator, Dividend Score Card, and many more.

  • Dividend Investor