Economy Shrinks- Recession warning signs mounting

NEW YORK (CNNMoney.com) -- The nation's economy slammed into reverse in the third quarter, as the government's initial reading of economic activity in the period declined.

The gross domestic product, the broadest measure of the nation's economy, fell at an annual rate of 0.3% in the period. That compared with a 2.8% growth rate in the second quarter, when economic stimulus checks and strong exports spurred by a weak dollar resulted in solid growth that vanished in the latest reading.

The decline wasn't quite as bad as forecasts. Economists surveyed by Briefing.com had estimated GDP would plunge 0.5%. But the fall was the weakest performance for the economy since the last recession seven years ago.

This latest reading is yet another warning sign of a recession, and marked only the fifth quarter in more than 17 years in which GDP fell below zero. Much of the impact of the recent crisis in financial and credit markets was not reflected in this reading, which reflects the period ending Sept. 30.