Visualizing The Collapse: Charting The Drop From Q4 2010 To Q1 2011 GDP (Which Came In At 0.8% Ex-Inventories)

Tyler Durden's picture

The bottom line: Q1 GDP ex-inventories came at 0.8%, the lowest since Q3 2009. The economy has hit stall speed, and absent another fiscal (nope) or monetary (QE3) stimulus, we will go negative in Q2, now that the full impact of the Japanese economic collapse has forced even the ostriches to pull their heads out of the sand. Alternatively, Bernanke will be stuck with the worst case of stagflation since the 1970s. Rock and hard place: just as we predicted in December 2010.

The chart below shows the ugly collapse in the economy in Q1: recall that up to a month ago it was supposed to grow by 4%! Now, ex inventories, it is 0.8%. And most importantly, the strong US consumer, in the form of the Personal Consumption Expenditures, sees his share of economic growth drop by over 30%, from 2.8% to 1.9%.

Ball is in your court Chairsatan Printocchio.

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Deep's picture

Chairsatan Printocchio


LOL LOL classic

lead salad's picture

Yeah.  That's a great one.  I needed that laugh this a.m.

alexwest's picture

fat armenian ass..

out of all Caucasian people who lives around Caspian sea armenians women are worst.. hairy, ugly, w/ big noses. 2000 years of inbreeding I might say


Vergeltung's picture

someday, you might even see a *real* vagina.....

SoNH80's picture

Armenians are great.  Tough people, surrounded by Mooslims, and never backed down.  Good food, too.

FOC 1183's picture

1.8% will be 0.8% by the final (3rd) revision

wswarrior's picture

The GDP number is not a useful tool to analyze anything.  It's manipulated in every possible way, so I don't even bother analyzing its components.  Make no mistake about it, the storm clouds are on the horizon and nobody will be able to hide from what's coming. 

ejmoosa's picture

Right on Warrior,

The ONLY line in the GDP report that tells us anything about the health of the economy is the Corporate profits line.  And we will not see that number for the first quarter for two more months.




franzpick's picture

A case could be made that most of the metrics used during the 6 decade long, fed-sponsored credit binge, are credit-expansion dependent, and misleading or worse during the ongoing worldwide credit collapse.

For one example, find me a public or private agency that makes any effort at all to downward-adjust personal consumption expenditures for the $50-75 Bil not being paid for PMI and RE taxes by 'stay-in' delinquent homeowners.  Such 'adjustments' just aren't on the radar.

Reggie and John Williams are trying, but credit-contraction metrics is still an emerging discipline, and most of the reported numbers are bogus.

alexwest's picture

spin will be
'DEBT LIMIT / GOVERMENT SHUTDOWN talks' scared consumers, not oil ( wink wink)


CrashisOptimistic's picture

Over Under for number of days until boots are on the Libyan ground?


I am Jobe's picture

Investing in Top Ramen.



baconator3000's picture

Ramen comes from Japan. Not a good idea. Unless you like your ramen walking around talking to you and glowing in the dark. Hell, maybe it even cooks itself!

Cdad's picture

Ball is in your court Chairsatan Printocchio.

Well....quite obviously what is called for, considering the data, is more money printing.  Sheesh...why are people so confused?  That, and E. Burnett turning up the adorable factor.  These two things can pull us out of the economic nose dive we are in.  







Caviar Emptor's picture

Now we know why kindly Uncle Ben thought we needed a talking to. 

I Want My GLD!!!

Josh Randall's picture

This weather is killing our economy!

Caviar Emptor's picture

What dropped? GOvernment spending. Exports and consumer spending slowed (hence inventories rose)

What Rose? Core PCE at the top of Fed's new panic estimate. Food/Energy Hot. 

What does that spell? BI flation Nation!

JailBank's picture

Even if you sat down 50% of the people in the US, showed them this chart, and explained in child like terms what this means I am pretty sure they wouldn't care. Now show them a chart showing how ABC rigged "Dancing With the Stars" reults and all hell would break loose.

Clorox Cowboy's picture

Can I get a "trade surplus" from the congregation?  Somebody scream!!!  


Team America, baby!

monopoly's picture

With all the knowledge most of us have, does our thoughts towards owning some gold, silver and miners really need explanation?

Only Robot can give us sound reasons to buy AMZN. :)

Not going to short this market as long as the Inmates are in charge.

Cassandra Syndrome's picture

Change in Private Investment, which is probably inflated, is only +0.09. And thats what drives recoveries. There is some praxeological merit to the accelerator principle, but it aint happening this time, because there are very few producers left, who have very limited capital to work with.

101 years and counting's picture

personal consumption up 1.9%.  not good considering obama gave the peeps that 2% reduction in SS tax withheld.  without that, GDP is negative.

Problem Is's picture

WOW! The "Change" was in my pocket all along...

I am sorry I called you a bald (beard-less) faced liar Barry Soetoro...

Caviar Emptor's picture

First of all everything bad was transitory. 

Factoring that in it was a glowing report

ZakuKommander's picture

"Transitory" is the new watchword of the Fed/Administration.

Until 2013.

PD Quig's picture

MarketWatch headline: "U.S. GDP Expands by 1.8%"

Hedgetard55's picture

10% of GDP is on the gov credit card and will be repaid (maybe) with interest by the next 3 generations.

DavidJ's picture

Default.  I am already teaching that to my 7month old daughter. 

baby_BLYTHE's picture

the dollar has lost 98% of its value since the beginnning of the Federal Reserve.

Prepare for that to happen again, this time within 10 years time.

10% GDP will be paid today, not by your children. Through run-away inflation.

Get ready folks, Inflationary Depression is coming

Sutton's picture

The solution to a declining economy is 0% rates and massive deficit spending with the Fed buying 75% of new treasury issusance.

It's so obvious.


bob_dabolina's picture

0% interest rates, printing trillions, borrowing trillions....


Better raise that debt ceiling, unless you want your children raped by terrorists.

Dejean Splicer's picture


"Real GDP growth gained 3.3% in 4Q, with all of the miss relative to our +4.4% forecast coming from inventories, with likely offsetting upside in 1Q. Final sales (GDP ex inventories) spiked 7.1%, a high since 1984, boosted by big gains in consumer spending (+4.4%) and net exports (+3.2pp contribution). Our preliminary estimate for 1Q GDP growth is now +4.5%, up from our last forecast of +3.3%, with inventories now likely to boost growth instead of subtract."

Was incorrect?

A Man without Qualities's picture

Imports and exports made up 3.27% to GDP growth last time, this time, minus 1.27%.

The decline in exports must be particularly disappointing...

Boston's picture

Rock and hard place: just as we predicted in December 2010. The chart below shows the ugly collapse in the economy in Q1

Yup.  And just as predicted, the natural consequence of this economic slowdown on US Treasuries is for them to RALLY---not collapse as many "experts" have insisted.

Paging Bill Gross, paging Bill Gross.



vxpatel's picture

China's consumer price index hit a 32-month high last month, placing immense pressure on farmers and food-makers to pay for costlier raw materials and distribution. Government price controls often mean those increased costs can't be passed on to consumers.

RobotTrader's picture

You guys simply don't get it.

TPTB will simply concoct yet another "scheme" to get things going again, another "cash for clunkers", or another housing stimulus program.

An unlimited number of scams can be cooked up to goose the economy.

Cassandra Syndrome's picture

"Society is 3 square meals away from anarchy"

Until they can print food, the ship is going down.

ZakuKommander's picture

Yes, and no.

There will come a time when diversionary tactics are needed, because the economy will simply not respond.  A new war, a new catastrophe, a new set of "outsiders" to demonize.  Some distraction can kick the can down the road, and perhaps set up a new paradigm so "goosing" can recommence.

Ying-Yang's picture

Robo Robo.... must have cut back on the coffee this morning.

Your comments are lacking your usual ZEAL.

I couldn't think of a reason to junk you although I like to just for fun!

EvlTheCat's picture

Newsflash deaf, dumb, blind kid, there is no such thing as perpetual motion!

Problem Is's picture

But he stands like a statue, becomes part of the machine...

His disciples lead him in, and he just does the rest...

LawsofPhysics's picture

Ah yes, the Who puts on a great show.

SoNH80's picture

Pushing on a string, pissing in the wind, sucking on a moldy hot dog, that's the Western world (incl. Japan) today...

StychoKiller's picture

Um, your avatar seems to be a coupla bucks short...

ssp2s's picture

An unlimited number of scams can be cooked up to goose the economy.

I think you meant to say "A limited number of scams can be cooked up to goose the economy temporarily."

Paralympic Equity's picture

Inventory cycle now over, cut all the taxex and start the printing, perpetuum mobile is possible...pause...NOT

EvlTheCat's picture

Anyone else trying to early withdraw from an IRA here?  Having troubles doing it?  Getting the run around?

I am on week 3 of trying to close down an account with hardly any funds in it.  Now the "check is in the mail".  Oh yes, and no tracking numbers are available.   Paid for next day shipping via UPS.  Day 3 for UPS next day shipping.  I am betting when I call back today they will try and tell me that my address was incorrect even though they have been sending me statements religiously to the same address for the last 5 years.

<sarc> UPS shipping sucks everyone.</sarc>