This page has been archived and commenting is disabled.
Q3 GDP Roars To 2.8% Despite Weakest Consumer In Over Two Years
A day of fireworks that started with the stunner by Goldman's head of the ECB has just gotten its second wind following the preliminary announcement of Q3 GDP, which roared from 2.5% to 2.84%, far above expectations of a 2.0% annualized number.
On the surface this was a bad number for Taper watchers, as it may mean the Fed will actually have to moderate its monthly flow precisely at the time when the ECB was forced to do "whatever it takes" in its fight with inflation, however a quick look at the internals shows that once again there is much more than meets the eye: because while the headline print was the strongest since Q3 2012, the core driver of economic growth, Personal Consumption, grew 1.5% below the expected 1.6%. Specifically, of the 2.84% number, PCE was just 1.04%, the lowest since Q2 2011!
Elsewhere, fixed investment - an indication of capex - was just 0.63%, below the 0.96% reported last quarter. So what drove "growth"? Why the traditional hollow component: Inventory, which amounted to 0.83% of the 2.8% print, double the 0.41% in the prior quarter. Net trade added an additional 0.3%, and finally government ticked on a modest 0.04% - the first positive contribution since Q3 2013.
In short: a little in here for everyone, with the market bulls happy to point out that the US consumer is the weakest he has been in over two years, while economist happy to highlight that the US economy is, in fact, growing at a brisk pace.
- 9884 reads
- Printer-friendly version
- Send to friend
- advertisements -



Well at least the bond traders were 'positioned' ahead of time. http://hedge.ly/16DAaWW
Proof that QE is working. More QE = More GDP.
I sell less, so inventory builds up. Sure, that sounds like economic growth: Retards. Corruption never wastes an opportunity to game the market, i.e. game all the participants like you.
Because they cooked the stats and said it's better. More of liten to what I say, not reality.
That's why they call it's Gross National PRODUCTION, not Gross National Sales or Gross National Deliveries.
Pack 'em, stack 'em and rack 'em. Plenty of Chevy Volts on the lot.
Reminds me of an old story back when "bradband" internet access as just becoming widely available. Phone companies were offering something called an ISDN line. Nobody was signing up for it. The joke in the industry was that ISDN stood for "I Still Don't Need it."
The one constant seems to be an increase in Personal Consumption Expenditures. Would this include all the free money being spent by the ultra-rich banksters?
Inventories grew because of the upcoming Christmas shopping season or was it too early for that?
Revisions bitchez!
Watch those rookie mistakes.
The stuff at the yard sales should be awesome in 2015!
20 million people being thrown off their present health insurance is very Bullish for the GDP.
Nope. Moar excuse to taper on as the 10 year Treasury yield is showing:
http://www.marketwatch.com/investing/bond/10_year
Whatever the US government spends... is also added to the GDP...
People should really know what GDP actually is :)
The more Obama throws through the window, THE HIGHER GDP WILL BE!!!
AND THE HIGHER THE GDP IS, THE MORE THEY CAN LOAN!!!
HAHAHAHAH
WHAT A FARCE!!!
Don't forget-the gov't re-jiggered the method of determining GDP back in July or there abouts.
So it' probably more BS.
Right, how much of this is atributable to blowjobs, back scratches and patronage in Washington. Now that those "contributors" to the economy are included, I'm surprised that it didn't print at 200% growth.
@d edwards
There is no reason to look at this number. It doesn't tell us anything other than what the Fed/UST complex wish to project. It's too bad the Amerikan sheeple are so easy to control.
"It's too bad the Amerikan sheeple are so easy to control."
Now all we need is an official statement that says the US constitution is a historical document and has no other purpose.
Heil Obama.!
Right....monetizing intellectual property
http://www.nytimes.com/2013/07/28/your-money/getting-creative-with-the-gdp.html?_r=0
That "re-jiggering" now includes intangibles when measuring GDP. About $500 billion worth of intangibles, or, 3% of GDP. Re-jiggering excluded...would the economy have actually shrunk?
Save in bitcoin, speculate in stocks. Welcome to your future.
Or perhaps save in bitcoin and speculate in gold, as stawks seem to be a conservative investment.
Ludicrous speed! Now!
The BEA's GDP tables tell us that the gross change in GDP from 2Q -> 3Q was $196.6 billion. But the Fed's QE program injected $255 billion, so in fact the economy shrank during the 3rd quarter.
Just think how good the number would be if the government was permenant laid off!
Market bulls point to a weak consumer. Sort of sums the bullshit up really
you don't get it, weak consumption is good new, means there is room for improvement...
Holiday discounts are gonna be bananas. Hold on and buy late, folks.
Hold on and buy nothing.
Taliban buying missile launchers and yellow cake.
Over.
Intangibles bitchez! GDP is whatever they say it is.
Dear leader's executive order, there will be no more recessions act of 2014.
The central planners are saying "We need another war".
GDP is meaningless since they redefined it over and over to meet their needs.
Zerohedge fucks up again. The economy does, ahem, seem to be growing. BTFATH. (no sarcasm intended).
You are aware the .gov started including intangibles, or those things that can't be touched or seen, in the equarion aren't you? Another way of putting it is...GDP is what .gov says it is. Maybe I'm giving you a little too much credit.
Proof please? Web link?
Do your own research. It happened!
What a moron!
A simple google search of "us gdp intangibles" will get you a number of links. It happened back in July.
Critical thought, friend. It's a liberating senstation.
Gee, these newfangled things called "the internets" and "the google" are difficult to get a grip on for luddites like me. But someone a bit more advanced than me (who no doubt is buying Twitter at $49) did show me these links:
http://www.shadowstats.com/alternate_data/gross-domestic-product-charts
http://ftalphaville.ft.com/2013/07/31/1587102/a-guide-to-the-conceptual-us-gdp-changes/
Thank you for advising me on thinking processes. My Oxbridge education was obviously wasted and I wish you had been around to tell me this 20 years ago.
But, "friend", "sensation", is not spelt the way you think. Correct your spelling, it is also liberating.
Its roaring so much everyone around the world will start selling all their dollars soon.
gee, building some inventory for Christmas sales. If the weak consumer numbers continue, we are set up for a nice whipsaw Christmas season.
Obama will have to start a christmas present welfare system, guaranteeing the 47% of Americans sucking on Govt teats 10 presents each, courtesy of taxpayer. Amazon will gladly help with all the taxpayer funded sales and delivery.
Of course the govt doesn't want to make you look emasculated, they'll throw in another 10 presents each to give away to your family and friends.
There has been no building of Christmas inventory this year. Retailers are creating artificial scarcity to hopefully drive sales. If people believe they can't get a product they will rush to get it.
If Macy's, Best Buy, Target, Walmart, etc have another holiday season like last year where they needed to put half the inventory at 50% off to get rid of it, they will be insolvent.
JC Penney is already dead. People forget that they still haven't paid vendors for product all year. They negotiated pay on scan terms because the vendors don't want the product back, there is nowhere they can sell the inventory to.
Organic Real growth will be the undoing of this sham. Interest Rates will go up, showing Government is insolvent. How much would interest payments be on a ten year at 5 or 6% ? Debt trap like mofo yo... Keep stacking..
BTFD - Between today and tomorrow 6 billion in new POMO
So dam the torpeodos and full speed ahead
Up up and away, at least for now
Thu, Nov 07, 2013 Fri, Nov 08, 2013 Outright Treasury Coupon Purchases 02/15/2036 - 08/15/2043 $1.25 - $1.75 billion Fri, Nov 08, 2013 Tue, Nov 12, 2013 Outright Treasury Coupon Purchases 08/15/2018 - 07/31/2019 $4.75 - $5.75 billion
Thu, Nov 07, 2013 Fri, Nov 08, 2013 Outright Treasury Coupon Purchases 02/15/2036 - 08/15/2043 $1.25 - $1.75 billion Fri, Nov 08, 2013 Tue, Nov 12, 2013 Outright Treasury Coupon Purchases 08/15/2018 - 07/31/2019 $4.75 - $5.75 billionThank goodness for all those "intangibles" they add in since the August revision to the way they calculate GDP. Have we so quickly forgotten that change?
When they introduced "intangibles" to the equation, it caused 2Q GDP to leap by 50%. If that same calculation holds true on this figure, then the real GDP should be closer to 1.85%. That's NOTHING to crow about!
Who the fuck downvoted you for the truth.
We really are in Orwell's nightmare.
The truth police are out in full force.
such fucking bullshit
GDP this!!!!
I don't even know what GDP is anymore. Is it the number of seahorses in Bernanke's knickers?
I just thought up an awesome new product last week, I even designed it and made a rapid prototype model of it.
It isn't for sale yet, but I believe it can sell 100 million units at $100.
ADD $10 BILLION TO GDP.
I have thought experiments all the time, producing all sorts of products. R&D that's worth billions if the products are produced.
I AM A ONE MAN GDP MACHINE!!!!!!
Elon Musk, HA. He's thought of what, four products in the past year. I've come up with thousands.
Well it is my job and I get paid for it. Since it's in GDP now, I need to demand to be paid for all the intangibles I wasn't getting paid for before. Since they backdated the intangible GDP to the early 1900s, I WANT 20 YEARS OF BACK PAY!!!!!!
Bullshit. The GDP didn't "roar" anywhere. You need to subtract what was spent into the economy with QE:
3Q GDP DECREASED $58.4 Billion
http://market-ticker.org/akcs-www?post=225788
Excerpt:
The Fed is "creating" $85 billion a month in "QE", injecting it into the economy. These funds are immediately spent and thus "count" in GDP (all goods and services sold, remember?)
So the actual amount of economic activity for which trade occurs must have the QE amount subtracted back out.
The BEA's GDP tables tell us that the gross change in GDP from 2Q -> 3Q was $196.6 billion. But the Fed's QE program injected $255 billion, so in fact the economy shrank during the 3rd quarter.
When people tell you that they believe the economy is in a recession, as a recent survey said was commonly believed -- they're right.