GDP Number in Q2 is 4%
Great news — if you put a lot of stock in the GDP number (which I don’t, for reasons I have explained in detail) — and if you ignore the fact that this is a bubble created by Fed policy, and that we have done nothing to fix the structural problems with our unsustainable fiscal policy and runaway entitlements.
I won’t be popping any champagne corks. But then, I don’t even like champagne.
What is the average decrease from original projections to end of revisions downward?
JD (c0a33e) — 7/30/2014 @ 8:10 amAnd, as always, the figures will be revised as more data come in. One would expect that, in a non-partisan effort, revisions would vary between upward and downward changes fairly evenly, but the revisions always seem to be downward, for some unexplainable reason.
The unimpressed Dana (f6a568) — 7/30/2014 @ 8:22 amI like champagne.
JD – great question. I did an analysis at an old job of our “marketing budget” vs. what we actually spent. Continuous revisions downward are like playing pretend.
carlitos (c24ed5) — 7/30/2014 @ 8:25 amIt’s great if you are in the stock market. Low-wage earner, forget it.
IOW Obama’s underbase is still hurting. Uberbase, ding great.
Patricia (5fc097) — 7/30/2014 @ 8:35 amAll the downward revisions are unexpected. I mean you can’t blame government for being optimistic, right?
Dejectedhead (a094a6) — 7/30/2014 @ 8:35 amooops….doing great.
Patricia (5fc097) — 7/30/2014 @ 8:35 amSix point swing Q1 to Q2 looks like the numbers got polar multiplexed. Very odd. Revisions will be interesting to watch. Q3 info will be out just before or delayed until just after midterms for political reasons.
daleyrocks (bf33e9) — 7/30/2014 @ 8:42 amdaleyrocks you are familiar with the “typo” administration? Or is it the
elissa (b9af8b) — 7/30/2014 @ 8:59 am“oops” administration. How can anybody take any of these numbers seriously any more?
Remember Q1 GDP as originally reported in February was eventually revised down a full 3% from an original report of +0.1% growth to -2.9%
These initial reports seem rather optimistic and they are setting that pattern on purpose. The Q3 numbers come out right before the November election.
crosspatch (6adcc9) — 7/30/2014 @ 9:16 amYou might like some Deccolio Proseco, it’s on sale right now at the Whole Foods.
SarahW (267b14) — 7/30/2014 @ 9:19 amIt’s good with strawberry cake or tiramisu.
This president sure has killed a lot of trees, printing money like it grows on them.
mg (31009b) — 7/30/2014 @ 9:22 amelissa – I was up north when the “speak-o” emerged, but this administration is no stranger to the use of “asspulls” when it comes to data, a technical accounting term for sourcing information which I believe I introduced to the blog.
daleyrocks (bf33e9) — 7/30/2014 @ 9:24 ami just noticed from the press release that former Associated Press propaganda slut Jeannine Aversa, who used to spin these same numbers for the AP, is now working for the BEA directly
happyfeet (8ce051) — 7/30/2014 @ 9:36 amWell, daley, what we obviously need now is for Ezra and Matty to ‘splain these amazing numbers to us. While you were camping you may have missed a couple more VOX treasures–like Matty’s map and chart about something or other which featured the “provinces” of the British Isles. Good times.
elissa (b9af8b) — 7/30/2014 @ 9:39 amactually since 2011
propaganda pig is well on her way to scoring a fat little piggy pension
happyfeet (8ce051) — 7/30/2014 @ 9:39 amif you put a lot of stock in the GDP number
The reliability of official statistics started to look shaky to me when CIA-vetted figures, no less, on the average unemployment rate for Mexico going back over 30 years showed it rarely rising above 4%. However, I notice the CIA website containing that information has since placed a cautionary asterisk under the set of figures in question. Nonetheless, if such information is taken at face value, our neighbor to the south looks like an ideal place for the unemployed.
Whether that assumption is accurate or not is important to know and understand, because Mexico’s future may be our future.
^ It should never be said that people in hand-to-mouth countries like Mexico are the way they are because, in terms of the work ethic, they sit around eating bons bons and watching TV all day. OTOH, it should also never be said that a work-or-die ethic necessarily allows a society to move upward and onward.
Mark (2604a9) — 7/30/2014 @ 10:04 amWOO-HOO!!!!!
Recovery Summer 2014 Baby!!!!! nothing can stop us now!
(except reality, of course. %-)
redc1c4 (abd49e) — 7/30/2014 @ 10:13 amelissa – Matty is always good for a beclowning and proof of concept for Wapo’s decision not to fund the Vox venture.
The lads did not manage to abscond with our white gas camping fuel while I was with them so we had no loss of eyebrows or missing hair due to aggressive fire starting procedures so far. I am hopeful the Newbie dads I left in charge will be able to maintain control.
daleyrocks (bf33e9) — 7/30/2014 @ 10:43 am^ It should never be said that people in hand-to-mouth countries like Mexico are the way they are because, in terms of the work ethic, they sit around eating bons bons and watching TV all day. OTOH, it should also never be said that a work-or-die ethic necessarily allows a society to move upward and onward.
Mexico is not a ‘hand-to-mouth’ country. It is a middle-income country with living standards on average similar to those of the United States in the 1920s. It has a very skewed income distribution, so there are deeper pits of poverty than you’d ordinarily see in a country with those production and income levels.
The CIA’s book is not the production of economic metrics and it is indubitably reporting in its public reference books statistics compiled by other agencies. The thing is, a country like Mexico has a substantial informal economy where many people earn a meagre living in a state of ‘individual as-enterprise’ or ‘family-as-enterprise’. Unemployment statistics are appropriate for countries which do not have contextually large informal economies and where one can readily classify people according to their employment status (which you cannot where people typically support themselves through petty commerce and juggling odd-jobs).
Art Deco (ee8de5) — 7/30/2014 @ 11:13 ama good portion of Mexico’s GDP is cash sent there from the US, and a good portion of their available w*rkforce is here in the US, stealing j*bs & driving down wages.
without the safety valve of sending their unemployed hordes here, Mexico might have already had the revolution it needs to destroy the corrupt scum who run the country for their own benefit.
redc1c4 (abd49e) — 7/30/2014 @ 12:30 pmThe 4% number – if true – still represents a net 1% annualized GDP gain for the first half of 2014.
But its not true, half of the number represents inventory stuffing. The consumer demand simply isn’t there, and the monthly consumer spending numbers for 2Q reflect that.
There is a near certainty of recession this year, if not a worse “correction”.
SPQR (f1f2c3) — 7/30/2014 @ 1:20 pmI was recently in a Best buy looking for a new digital camera. There were many models on display, but less than half of those were in stock. The atmosphere I observed there reminded me of Circuit city’s last year of existence.
felipe (960c75) — 7/30/2014 @ 1:37 pm2014 Q1 GDP estimates:
+0.1% April 30
-1.0% May 29
-2.9% June 25
-2.1% July 30
2014 2Q GDP estimate = +4.0%
What is it 98 or 97 days until the election?
And 99 days to the revised Q2 GDP estimate of -2.3% and the recognition of the technical start of the Obama Recession Part deux.
in_awe (7c859a) — 7/30/2014 @ 1:44 pmwithout the safety valve of sending their unemployed hordes here, Mexico might have already had the revolution it needs to destroy the corrupt scum who run the country for their own benefit.
Mexico has an abnormally high crime rate and a fairly skewed income distribution. Otherwise, it’s about average for the human race. The country has had unbroken institutional continuity since 1920, replaced in stages a system of political machine rule with competitive politics over the period running from 1983 to 2000. I cannot think of any Latin American countries which would benefit from a revolution, though some might benefit from a capable autocrat for a run of years (e.g. Gen. Pinochet). Capable autocrats are not very common. There are 120 million people in Mexico and about 20 million chicanos in the U.S. (some American born). Obviously, that has had an impact. Was emigration a ‘safety valve’ or just an opportunity? Peru was poorer than Mexico and suffering more severe internal disorders during the period running from 1980 to 2004 than Mexcio has seen since 1930. Peru lacks a boundary with notably affluent states. Yet, Peru improved its relative position greatly during the period running from 1980 to 2010 and it’s streets are much more tranquil than Mexico’s.
Art Deco (ee8de5) — 7/30/2014 @ 2:39 pmHere’s a link for Mr. SPQR’s comment
happyfeet (8ce051) — 7/30/2014 @ 3:09 pmfelipe, Best Buy has been on life support for years now.
SPQR (c4e119) — 7/30/2014 @ 3:26 pmLets wait for the real, revised, numbers!
Rich (ddc02c) — 7/30/2014 @ 3:32 pmThis happened in 2012, too. If you have a pliant Fed, you can give the economy an upper any time you want. Just print another $2-3 trillion and loan it out at 1% and 3 months later things pick up. You do that in spring and summer and by the time the withdrawal sets in you’re safely past the election.
The country needs to go to Debtor’s Anonymous. Only problem is we probably have to hit bottom first.
Kevin M (b357ee) — 7/30/2014 @ 3:57 pm“Yet, Peru improved its relative position greatly during the period running from 1980 to 2010”
Art Deco – More from 1990 to 2010?
Viva corrupt autocrats of Japanese descent!
Out with Tupac Amaru and Shining Path.
daleyrocks (bf33e9) — 7/30/2014 @ 4:08 pm22. felipe (960c75) — 7/30/2014 @ 1:37 pm
I was recently in a Best buy looking for a new digital camera. There were many models on display, but less than half of those were in stock. The atmosphere I observed there reminded me of Circuit city’s last year of existence.
</i.
Digital cameras break, and when they break, I think the companies say it's your fault and won't honor the warranty. It's best to buy a several years old camera on eBay ffor much less money.
Sammy Finkelman (eb1481) — 7/30/2014 @ 4:17 pmThis scene from “The Wire” showing Baltimore’s Finest being ordered to fix the crime numbers for the mayor’s re-election:
https://www.youtube.com/watch?v=xH_6_8NOfwI
“Murders will be held to 275 for the year!”
Kevin M (b357ee) — 7/30/2014 @ 5:56 pmWhatcha wanna bet the “official” unemployment rate drops below 6 percent in October?
Whitey Nisson (aae971) — 7/30/2014 @ 6:40 pmI like champagne a great deal. I’ve had no national news to prompt me to drink it since Obama was elected in 2008, though. So it’s a good thing I don’t wait for that as an excuse to drink it.
Beldar (fa637a) — 7/30/2014 @ 6:49 pmMexico is not a ‘hand-to-mouth’ country. It is a middle-income country with living standards on average similar to those of the United States in the 1920s
I’m not too sure about your definition of “middle-income,” but if you’d rather not characterize the place as “hand-to-mouth” then I can re-phrase that to “mediocrity run amok.” Or similar to one of those very half-crocked urban areas throughout America that are always socially, economically and physically third or forth rate, full of crime, full of crooked, leftwing politicians and the type of voters who keep them in office, lousy schools, a semi-comatose local economy, all interspersed with no sense of the potential greatness of humankind, no sense of a brighter, better future.
Mark (2604a9) — 7/30/2014 @ 7:22 pmHaHaHaHaHaHaa!
Guess what happens with GDP forecasts presuming zero inflation when it’s actually running 8-10%.
This is all ‘inventories’ built, despite declining employment, declining orders, declining deliveries, Baltic Dry index teats up, et cetera, ad infinitum.
Total horsesheet from your government one more time, because it will make you confident and spend your grandchildren into the poor house.
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I am Sree Buddha Dev Ray, I read your article “GDP Number in Q2 is 4%”.I became very happy to read your article.
If anybody read your article, he or she will be benefited.
Thank you
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Sree Buddha Dev Ray (5dd20e) — 7/31/2014 @ 6:08 ami’ve got your booming economy right *here*… we need to start a pool on just how far down that 4% is going to be revised.
redc1c4 (abd49e) — 7/31/2014 @ 1:47 pmI reluctantly sold all my stock on Tuesday. We’ve had a 64 month rally. It just has to end soon.
My gf and I sell garage-sale finds on eBay. Page views are way down this year.
I see signs of people getting liquid.
Mr. P says “we have done nothing to fix the structural problems with our unsustainable fiscal policy” and that hits the nail square on the head. We learned nothing from Sep 2008!
gp (0c542c) — 7/31/2014 @ 6:03 pmOn top of that, the US govt is lawless and no longer credible.