Yes, they really did have it at 4.5% before. These are precisely the deranged groupthink herd mentality and permabullish prognostications that only economic Ph.D.s can come up with. From the downgrade: "Incorporating today’s weaker- than-expected news on business inventories and retail sales, we have cut our Q2 GDP forecast to 3.0%, below our previous tracking estimate of 3.5% and our official 4.5% forecast. Business inventories rose 0.1% in May, below our (0.3%) and the consensus (0.2%) forecast, and this suggests that inventory accumulation is unlikely to make as big a positive contribution to Q2 GDP as we previously projected. Meanwhile, as discussed below, although core retail sales rose 0.2% in June, downward revisions to April and May point to private consumption growth of about 2.5% in Q2 as a whole, compared to our previous forecast of 3.5%. Finally, May’s trade data suggest the trade deficit widened further in Q2, implying more of a drag on GDP growth than we had previously expected." Look for many more red and discredited faces as the economist lemmings gradually realize that Rosenberg's prediction of negative GDP in 2011 is proven right.