It's bizarre, but economists think we've been having a rip-snorting recovery for a while now. Ordinary citizens don't get it. Apparently we may be right:

U.S. Economy Recovering at Only Half Official Rate, Research Shows

America's buoyant economic recovery could largely be a statistical illusion, according to research released this weekend....

The latest analysis from Goldman Sachs suggests that the US economy may have grown by only about 2.2 percent in the year to the fourth quarter of 2003, considerably less than the official 4.3 percent....

Big flaws in the manufacturing data are responsible, according to the Goldman research. Real GDP for goods, which accounts for 33 percent of total GDP, has surged by 8 percent over the past year, the official figures say, more than double its 3.6 percent long-term trend. But these figures are in complete contradiction with the standard data for industrial production, a closely-related and far more reliable measure calculated using separate data.

Industrial production increased by only 1.4 percent in the fourth quarter of 2003, compared with the same quarter of 2002. In February, production was up a mere 2.7 percent year on year, revealing a huge flaw in the US GDP figures....

Another reason why the US official growth rate may have over-stated growth is because of its use of "hedonic pricing", a method which adjusts inflation for quality, other economists say....

Because computers purchased today are more powerful that computers bought a year ago, a similar level of cash spending on IT would automatically be translated into strong growth in the GDP numbers, even if there has been no increase at all in the number of dollars spent by US companies or consumers from one year to the next....

Kurt Richbacher, editor of an eponymous investment letter, said: "These particular dollars are fictitious dollars that nobody has paid and nobody received. Obviously, such dollars inherently add nothing to profits...."

--Kinight Ridder's Sunday Business, London, via Miami Herald