Guest Post: Q3 GDP - The Devil Is In The Details

Tyler Durden's picture

Submitted by Lance Roberts of Street Talk Live,

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Thecomingcollapse's picture

It's all a sham and a farce, numbers mean nothing anymore!

economics9698's picture

“The output gap as a percentage of potential GDP did narrow this past quarter from 6.01% to 5.78%.  The output gap, which is the difference between real and potential GDP, continues to run at levels normally seen during recessions.  The problem is that it has been nearly four years since the peak of the previous recession and we are still at a very severe gap.”

Nauseating Keynesian bull shit.  We know what the problem is, cheap credit and malinvestment.

Let the TBTF fail.

Cut spending to 18% of the GDP at the federal level.

Stop printing money.

Just stop it with the economic bull shit.


ACP's picture

I thought the Devil was in the White House?

Hey! Ho! What is this an oil painting?

disabledvet's picture

Indeed. In fact we now know that "growth" itself (the "p" in GDP) is a fiction since the totality of the economics profession simply substitutes "spending" for the who useless edifice. But how to increase spending when credit is contracting? Hmmmmm. "START A WAR!" is one way...unfortunately without a gold standard "how do I finance said fiatsco?" To which I answer NOT EASILY! The current variant ("Syria") seems to be financed "via print media." This could work! "You may have the war you are looking for kind sir." HOWEVER...who reads said claptrap anymore. Too few indeed. So what is our poor Napoleon to do? Le Fu Manchew? I say "adieu." Yes sheeple "we shall finance impending doom with adieu." Long, sorrowful, tearful...misbegotten "good byes." Ah my Naval Gazing...I wipe my handkerchief for your journey non. How can I express your nearness to my heart...your soft boosom to my heft. So lightly you bore my fruit. By the See calls ye Tufted Titmouse. Verily I beseech you...yet you journey to vast regions yet unexplored. But I digress...what was the story again? Oh, yeah. "An economy without means of payment." Hmmm..."a journey to parts unknown" indeed.

masterinchancery's picture

You mean autos parked on Dealers' lots, or "sold" with subprime loans aren't real GDP? Take that man's name!

knukles's picture

Hold it hold it hold it...
Liesman called Santelli a Conspiracy Theorist (or some equivalent this morning) Santelli shrugged, Liesman went on to dissect the numbers and kinda concluded that the Goobermint contribution was probably too big then Kiernan interjected some tripe about "rising above" and that starting at 2.7% is a pretty good start if that's where we're really starting from unless we're really starting somewhere else and all the while Santelli looked like he'd already had a long day with a bunch of manic kindergarteners and Liesman went on to basically (absurdity) say (quoting God) that "It was Good" even though he said the numbers weren't any too swift.  And then Becky mumbled some horseshit that I could not for the life of me understand as it seemed like my brain had shut down from all the stuff noise and static  nonsense which made no sense.  In fact for a moment I wasn't sure they were speaking in English.....

So everything's ducky!

Thecomingcollapse's picture

Oh good, because I was starting to worry.  Glad to know everything is fine..... I'll go back to mindlessly consuming (    ) insert your favorite ithingy and twinkies.

Cpl Hicks's picture

I, too, am proud to be an Amerukkan!

fonzannoon's picture

Say it again Lance, QE4. Was it just a year ago when the big debate was whether we needed QE2? Now we blew past QE3 like a fart in the wind and here comes QE4. So yeah lets talk about nonsense horseshit and just make pretend 85 billion a month is not being thrown into the black hole.

Thecomingcollapse's picture

Preach it brother Fonz... preach it!!

Everybodys All American's picture

$85 billion a month. Think about that. That is a crazy large number. Hyper-inflation can't be all that far ahead.

I wonder what this time next year things will look like? Any price predictions?

fonzannoon's picture

Everybody, I used to feel the same way (hyperinflation). But I am really starting to rethink that. If people are deleveraging, and by that I mean defaulting on debt, not paying it down, then the 85 bil is offsetting that. Also if wages are stagnant/falling it makes hyperinflation hard to see happening as well. If Ben was sending that 85 bil to each citizen we'd have hyperinflation in an instant. But he is just making bankers rich the way he is doing it.

But the end of the road is inevitable. The debt will crush us. If gas is $5 a gallon and milk and bread cost $7 that may as well be hyperinflation when you are piss broke.

Next year I would guess  the 10yr hits 1.25% at some point. The market drifts higher as everyone crowds into anything with a dividend. Commodities drift lower. All asset bubbles inflate to a point where even most of the hard headed bears think about cratering, and many will. Then.....BOOM. Maybe that boom is 2014 or 2015 or who knows. But as the guy in the matrix said "That is the sound of inevitability".

LetThemEatRand's picture

Ben thinks that $5/gallon gas etc is fine, because he assumes (incorrectly) that wages will catch up.  I remember the '70's when $20/tank to fill a gas guzzling 500 cubic inch American machine seemed insane and took a major bite from the average person.  Now, most would see $20/tank as Godsend, because wages did catch up, at least in part.  What Ben doesn't realize is that 40 years of offshoring has eliminated the wage-increase effect of broader inflation.  The consumer still has demand, but no money other than CC debt.  Because the middle class has been crushed by 40 years of supply-side economics and wages replaced by easy credit.  It's remarkably simple, really, but those at the top don't care because they've got theirs.

fonzannoon's picture

LTER do you really believe that about Ben or do you think it is more realistic to think that he understands how far gone everything is and is just enriching the shit out of his buddies before they burn the house down? I mean at this point when the break the huddle and his bald head walks up to that microphone even he has to think "I'm goin in with QE4....this shit is going to blow any minute now".

LetThemEatRand's picture

I don't know.  I go back and forth on this question (whether he believes his own bullshit, or whether he merely has his own self-interest in mind).  My best guess is that he believes he can navigate the problem in a way that his buddies who will take care of him are enriched and the status quo maintained.  But I don't discount the idea that he is operating entirely in a world of pure self-interest where he sees himself at the top of the heap and doesn't give a flying fuck what happens to the rest of us.

fonzannoon's picture

In some demented way I could see him thinking he is patriotic. He sees himself holding this whole thing together with duct tape. I think he is one question away from giving his own version of the "You want me on that wall, you need me on that wall" speech. He wants to scream that we better learn to embrace this shitty economy because the alternative is a collapse of the currency. He and his buddies know that the leavee is going to break. When it does they will all be positioned for it. They will quietly clean up afterward. That is my best guess.

disabledvet's picture

I would argue it's not "supply side economics" PER SE but "crazy marketing of debt to people who have no business even having money"...the word "students" comes to mind. We're SUPPOSE to be hungry when we go to school...that's why they call it "an education." When you or I or Simone else is "sold into debt slavery"...has the Governmnet explained this yet?...the "bondage" that results is catastrophic...FOR EVERYONE. (Save the media which always craves attention more than you and I.) sorry but I'm not sure "Syria" (tm) can bail us out of this one. Sandy has opened a lot of eyes to just how little "Government"...let alone "Banking" (tm) even exists anymore. "We're all just trading platforms now." Only this time "in the game of life itself." SAC...big as it "small potatoes" next to the real big ones in "the dark rooms of Bloomberg" or the "mainframes at Langley." These machines give the wannabe wealthy and the wannabe powerful the illusion that "they didn't just do that" but indeed they..."have" done it (meaning set events in motion that cannot be undone or impeded). though it be a .exe that "finished the plan" or "completed the mission" let us never forgot The who, the what and the when that started it. Remember folks "the only way to win is not to play." And methinks the whole world is about to see the meaning of that just a few weeks? Maybe even less. "The Third World War lasted a decade. The fourth only a few minutes."

disabledvet's picture

"Long F 35 fighter jets." I'll open at a billion...for ONE.

LetThemEatRand's picture

It's worker pensions that are the problem.  Entitlements for the military industrial complex are off limits.

davidsmith's picture

Growth is easy when you channel stuff, inventory build and cook the books!

disabledvet's picture

That's the hard way actually. The easy way is to monetize 25 billion a DAY "and let someone else worry how the money is being spent."

buzzsaw99's picture





s Pending

BullyBearish's picture

Take note of the Hilsenrath Index...when he prints, things are worse than you think and RISK is cued "ON"

ali-ali-al-qomfri's picture

I would have thought by now that we would have had a more dramatic increase in GDP due to the increase in ink cartridges and rolled linen paper. No?

EscapingProgress's picture

GDP is only growing if you believe government statistics.

Who to believe...who to believe...

Glass Seagull's picture

GM dealers in midwest sold lots of USED cars a couple of months back - abnormally large volumes.  There's your pulse check on the backbone of America.  Channel brimming, absolutely brimming with new inventory, yet the second-hand goods keep moving instead.

JMT's picture

what about likely strong consumer spending (consumption) in current quarter?? Over the total Thanksgiving week people spent more than previous year.. Consumer confidence & housing sales are also at a four or five year high which is only great for the current quarter. 

There definately was this 'herd' mentality. People felt like they had to spend to buy the latest stuff (mostly designer clothes & yet another smartphone at full retail price)

Lord Of Finance's picture

Mark Faber stated that the economic data coming from the U.S. is total propaganda using heady hedonics comparible to the nazis economic data figures they released in the 1930's showing insanely unrealistic growth. All these lies about the real state of the economy will be good for us precious metal hoarders though:)

overmedicatedundersexed's picture

cnbc dosn't dare say GREEN SHOoTS..if they did even the dumb shits still watching cramer might go HUMMMM.