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Recession is over. GDP Up huge...
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Freethinker 
They can't eat ya...
User ID: 803599
10/29/2009 3:21 PM
Report abusive post | Recession is over. GDP Up huge...
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Take it away KD!
GDP Is..... Better Than Expected?
Oh what a tangled web we weave....
Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 3.5 percent in the third quarter of 2009, (that is, from the second quarter to the third quarter), according to the "advance" estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP decreased 0.7 percent.
Looks good, right?
Hmmmm.... or is it?
Motor vehicle output added 1.66 percentage points to the third-quarter change in real GDP after adding 0.19 percentage point to the second-quarter change.
....
Real federal government consumption expenditures and gross investment increased 7.9 percent in the third quarter, compared with an increase of 11.4 percent in the second.
Ok, from this we can compute a few things.
3.5 - 1.66 - (7.9 * 30%) = -0.53%
Now let's adjust for inventories:
The change in real private inventories added 0.94 percentage point to the third-quarter change in real GDP after subtracting 1.42 percentage points from the second-quarter change.
-0.53% - 0.94% = -1.47%.
Ok, that's bad but not catastrophic and is an actual improvement compared to the second quarter. But....
Current-dollar personal income decreased $15.5 billion (0.5 percent) in the third quarter, in contrast to an increase of $19.1 billion (0.6 percent) in the second.
Personal current taxes increased $4.8 billion in the third quarter, in contrast to a decrease of $119.1 billion in the second.
Eeeeehhh... those are both going the wrong way. Taxes up, income down. And...
Disposable personal income decreased $20.4 billion (0.7 percent) in the third quarter, in contrast to an increase of $138.2 billion (5.2 percent) in the second. Real disposable personal income decreased 3.4 percent, in contrast to an increase of 3.8 percent.
That's worse. A lot worse. Disposable personal income decreased in nominal terms q/o/q by 5.9% while in real terms (inflation adjusted) it decreased q/o/q by 7.4%! That is an enormous swing in purchasing power and not in the right direction!
Personal outlays increased $148.2 billion (5.8 percent) in the third quarter, compared with an increase of $8.2 billion (0.3 percent) in the second. Personal saving -- disposable personal income less personal outlays -- was $364.6 billion in the third quarter, compared with $533.1 billion in the second.
The personal saving rate -- saving as a percentage of disposable personal income -- was 3.3 percent in the third quarter, compared with 4.9 percent in the second.
So into decreasing personal income and disposable personal income people tried to spend anyway. Best guess: most of this was "cash for clunkers", which is the worst sort of "spending" - it is the taking on of more debt by replacing a paid-off car with one that now comes with a shiny (and nasty) payment book. The Trade: Go long auto repo outfits (aside: as far as I know there are no publicly-traded repo companies.)
Nothing in here I like; to the contrary, this report sucks and on a drill-down appears to be full of outright lies.
Looking inside the data, the "big change" in private domestic investment is all residential fixed - up 23.4%. I don't believe it. I've been scouring the homebuilder earnings releases and data, and I don't see the numbers that support this. An improvement over the ditch-diving of the last many quarters, yes - but a 23.4% increase, a swing of fifty percent from Q2-Q3? Oh hell no. Where is it? It's not in Home Depot's or Lowe's quarterly results, it's not in the homebuilders, and I can't find it in the suppliers (lumber companies, etc) either. This sort of move would result in monstrous top-line revenue increases reported by firms in this sector and that simply has not happened.
Nor do the export and import numbers look right. Port of Long Beach and LA anyone? Those numbers also don't add up - swings of 20-25% in one quarter? Not reflected in container volumes and freight loadings. Yet it has to be - how do you get something in or out of here without it going through a port?
Government looks right, both federal and state/local. The "Obama will cut defense and war spending" folks have to be bashing themselves with a hammer - there's no evidence for that in the data, now three quarters into his administration. If you're anti-war and "bring the troops home", you may want to re-think whether voting for Barry was a wise decision - he sure as hell hasn't kept that promise. (Note that I didn't think he would either but that lie sure played well in San Francisco, didn't it?)
Forward the big problem is the deterioration in personal income. You can't spend what you don't have without credit creation, and that's fallen off a cliff. The Fed's credit reports continue to come in with huge contractions - this should not surprise, as demanding that banks lend to people who are seeing their income shrink is into the realm of pure idiocy.
The market likes the numbers although a lot of the move - perhaps all of it - is Bucky getting thrown under the bus once again.
You can't expect the cheerleaders on CNBC to read beyond the headline numbers, and they (once again) did not disappoint in this regard. The first 20 minutes of "analysis" brought not one mention of the decease in personal income or disposable personal income, yet on a forward basis this is in fact the most important piece of information in the report.
You cannot have an economic recovery when on a q/o/q basis real disposable income is contracting at a 7.4% annual rate and worse, the spread between nominal and real income is widening, indicating that mandatory purchases such a food, energy and health care - are increasing.
and it does no harm to the beauty of the sunset to understand the mysteries of the sun |
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Freethinker
They can't eat ya...
User ID: 803599
10/29/2009 3:22 PM
| | Re: Recession is over. GDP Up huge... | Quote |
in a world dominated by misinformation and "this lie is for the truth" cheerleading, Denninger at least has the balls to dig deeper and report what he finds.
and it does no harm to the beauty of the sunset to understand the mysteries of the sun |
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Freethinker
They can't eat ya...
User ID: 803599
10/29/2009 3:23 PM
| | Re: Recession is over. GDP Up huge... | Quote |
this recovery is going to falter. there is no way around it. You simply can not abuse a nations currency, reward the elite and punish the working class without serious repercussions.
and it does no harm to the beauty of the sunset to understand the mysteries of the sun |
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Anonymous Coward
User ID: 804278
10/29/2009 3:24 PM | | Re: Recession is over. GDP Up huge... | Quote |
Jobless recovery ... move to Africa ! |
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Anonymous Coward
User ID: 805229
10/29/2009 3:27 PM | | Re: Recession is over. GDP Up huge... | Quote |
blah blah GDP is up markets are up. My portfolio has increased in value as have my other funds have grown. Doomer PWNT. OBAMA HAS SAVED US ALL. BUSH FAILED US ALL AND OBAMA SAVED US. |
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Anonymous Coward
User ID: 805819
10/29/2009 3:34 PM | | Re: Recession is over. GDP Up huge... | Quote |
GNP is up but nowhere near as much as my height. Last quarter I grew two feet in height!!!
I am getting offers from the NBA like you would not believe. OK you probably would not believe. |
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Freethinker
They can't eat ya...
User ID: 803599
10/29/2009 3:34 PM
| | Re: Recession is over. GDP Up huge... | Quote |
blah blah GDP is up markets are up. My portfolio has increased in value as have my other funds have grown. Doomer PWNT. OBAMA HAS SAVED US ALL. BUSH FAILED US ALL AND OBAMA SAVED US. Quoting: Anonymous Coward 805229
you smell that? it's ass...pull your head out and breathe the fresh air of fail.
Last Edited by Freethinker on 10/29/2009 at 3:35 PM
and it does no harm to the beauty of the sunset to understand the mysteries of the sun |
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Freethinker
They can't eat ya...
User ID: 803599
10/29/2009 3:36 PM
| | Re: Recession is over. GDP Up huge... | Quote |
GNP is up but nowhere near as much as my height. Last quarter I grew two feet in height!!!
I am getting offers from the NBA like you would not believe. OK you probably would not believe. Quoting: Anonymous Coward 805819
I believe you. its a combination of swine flu vaccine and the gravity affects of planet x
and it does no harm to the beauty of the sunset to understand the mysteries of the sun |
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Freethinker
They can't eat ya...
User ID: 803599
10/29/2009 3:37 PM
| | Re: Recession is over. GDP Up huge... | Quote |
Jobless recovery ... move to Africa ! Quoting: Anonymous Coward 804278
there was a reason my ancestors moved out like 124,760 years ago. I am not keen to reverse their wisdom.
and it does no harm to the beauty of the sunset to understand the mysteries of the sun |
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Anonymous Coward
User ID: 805889
10/29/2009 3:42 PM | | Re: Recession is over. GDP Up huge... | Quote |
That 3.5% was due to cash for clunkers,and most of those cars will be repossed. Just the poor going out and buying a car to get something from the gov. Next quarter the gdp will
be steady due to some christmas buying, and the nest quarter gdp will drop like a rock and the suckers that bought stock will be crying for moma and cursing cnbc for misleading them. Then by june 2010 we will be in a great depression for worse than 80 years ago. |
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Anonymous Coward
User ID: 805819
10/29/2009 3:42 PM | | Re: Recession is over. GDP Up huge... | Quote |
BUSH FAILED US ALL AND OBAMA SAVED US. Quoting:
Yeah bush and his cowardly congress enacted all the laws to put us in concentration Kamps if we refuse to take the deadly needle. Obomba is executing the death protocol. |
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Levski
User ID: 318585
10/29/2009 3:49 PM | | Re: Recession is over. GDP Up huge... | Quote |
blah blah GDP is up markets are up. My portfolio has increased in value as have my other funds have grown. Doomer PWNT. OBAMA HAS SAVED US ALL. BUSH FAILED US ALL AND OBAMA SAVED US. Quoting: Anonymous Coward 805229
Is he for real?
Is that sarcasm? |
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Anonymous Coward
User ID: 805799
10/29/2009 3:51 PM | | Re: Recession is over. GDP Up huge... | Quote |
“As expected the biggest single contribution to growth came from consumption, which rose at a 3.4 percent rate, adding 2.4 percent to G.D.P. growth. We reckon about a third of the rise in consumption was due to the clunker program. In short, a decent quarter, thanks in part to stimulus; expect much weaker Q4.” — Ian Shepherdson, High Frequency Economics |
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Freethinker
They can't eat ya...
User ID: 803599
10/29/2009 3:52 PM
| | Re: Recession is over. GDP Up huge... | Quote |
blah blah GDP is up markets are up. My portfolio has increased in value as have my other funds have grown. Doomer PWNT. OBAMA HAS SAVED US ALL. BUSH FAILED US ALL AND OBAMA SAVED US.
Is he for real?
Is that sarcasm? Quoting: Levski
surely.
and it does no harm to the beauty of the sunset to understand the mysteries of the sun |
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Freethinker
They can't eat ya...
User ID: 803599
10/29/2009 3:52 PM
| | Re: Recession is over. GDP Up huge... | Quote |
“As expected the biggest single contribution to growth came from consumption, which rose at a 3.4 percent rate, adding 2.4 percent to G.D.P. growth. We reckon about a third of the rise in consumption was due to the clunker program. In short, a decent quarter, thanks in part to stimulus; expect much weaker Q4.” — Ian Shepherdson, High Frequency Economics Quoting: Anonymous Coward 805799
yep
and it does no harm to the beauty of the sunset to understand the mysteries of the sun |
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Anonymous Coward
User ID: 805899
10/29/2009 4:03 PM | | Re: Recession is over. GDP Up huge... | Quote |
Take it away KD!
If you're anti-war and "bring the troops home", you may want to re-think whether voting for Barry was a wise decision - he sure as hell hasn't kept that promise. Quoting: Freethinker
Well, I'm antiwar but I voted for Ron Paul. I don't think McCain would've brought the troops home either. |
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Anonymous Coward
User ID: 792499
10/29/2009 4:10 PM | | Re: Recession is over. GDP Up huge... | Quote |
GNP up.....hooray!
The sheep only see the number and not the manipulation behind it. The stimulus only bought time. The reaper is still waiting at the door. |
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Anonymous Coward
User ID: 746244
10/29/2009 4:24 PM | | Re: Recession is over. GDP Up huge... | Quote |
You dumb main stream viewing media hillbilly..You honestly believe that horseshit? The GDP is UP because they threw 12 trillion dollars at a bunch of bankers who socked it away in Europe. They made the numbers up so people like you can go out and BUY some more junk. This way they can do it again for Christmas presents |
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Freethinker
They can't eat ya...
User ID: 803599
10/29/2009 4:26 PM
| | Re: Recession is over. GDP Up huge... | Quote |
You dumb main stream viewing media hillbilly..You honestly believe that horseshit? The GDP is UP because they threw 12 trillion dollars at a bunch of bankers who socked it away in Europe. They made the numbers up so people like you can go out and BUY some more junk. This way they can do it again for Christmas presents Quoting: Anonymous Coward 746244
did you even read the article sphincter-face?
and it does no harm to the beauty of the sunset to understand the mysteries of the sun |
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Anonymous Coward
User ID: 806210
10/30/2009 12:46 AM | | Re: Recession is over. GDP Up huge... | Quote |
did you even read the article sphincter-face? Quoting: Freethinker
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