Someone Is Dead Wrong About The Economy

Tyler Durden's picture

As we reported earlier, for some today's economic humiliation of a -1.0% GDP print was merely more good news, and as Goldman announced, weaker than expected Q1 GDP will merely lead to a greater than expected rebound in Q2 GDP.

Here are some other takes:

  • ING: “Overall, this isn’t a terrible outcome”; Sees 2Q GDP at 4.5% annual rate "with inventory rebuilding likely to play its part"
  • Strategas "GDP -1%, old news....mostly noise"
  • Bank of Tokyo's Chris Rupkey: "2Q growth seen at nearly 4%... Weak 1Q is stone cold dead as an indicator of where the economy is headed."
  • Newedge: "Prospects for the near future remain relatively optimistic" Sees GDP accelerating to “around 3%” in 2Q as well as second half of year

And of course, the "best" take comes from the White House economic advisor Jason Furman, who said that March, April data "provide a more accurate and timely picture of where the economy is today” and show recovery from recession... A recession which ended 5 years ago mind you. He adds that GDP figures can be volatile; “it is important not to read too much into
any one single report.” Especially if the report shows a 2% contraction when excluding the benefits of Obamacare.


All of these "bullish in the face of adverse data" opinions are what we would dub the equity market's take: ignoring hard data, and betting on the Fed's balance sheet and hope for the future (and a blemish-free weather forecast in a priced to perfection and centrally-planned economy of course)


And here is the non-equity market take:

FTN, whose 1st bullet takes the prize today:

  • Negative GDP, as reported in 1Q, is “rare for expansions,”
  • “The growth trajectory is flatter than normal, a consequence of an ongoing credit squeeze that has dragged on so long”
  • 1Q inventory decline suggests 2Q GDP rebound of 3.8% annual rate
  • However, “don’t be fooled into thinking -1% was an anomaly and 4% is the new baseline”
  • Drop in 1Q corporate profits dashes hopes for increased capital spending this year

GMP, Adrian Miller: "After 1Q GDP contraction, 2Q data has been very much mixed with the jury out on near-term growth momentum,”


  • GDP shows economy lost ground this winter; so far, little indication will be huge pickup in 2Q home sales to make up for 1Q’s “lethargic” housing mkt, says Nela Richardson, Redfin chief economist.
  • Low inventory, rising prices continue to be “significant headwinds” to housing demand
  • Homebuyer demand in many areas also hurt by affordability pressures, stagnating median incomes that haven’t kept up with inflation

Bottom line: someone is dead wrong on the economy, but we are glad that the weathermen formerly known as economists are putting all these timestamps out there in the public domain. Because we eagerly look forward to seeing just what the scapegoat will be when Q2 GDP mysteriously fails to soar to 4%. And judging by what the bond market is doing, the only place that may see 4% growth in Q2 is China (net of all the fabricated data of course).

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Winston Churchill's picture

Forty acres and a mule in every pot, or something.

hedgeless_horseman's picture



Forty ounces of Monsanto HFCS and Tyson "chicken" fingers in ever voter.

Bonus link: Biopsy of the Obamacare risk pool.

gh0atrider's picture

The virtualized economy of crypto-currencies is booming.

Spastica Rex's picture

What happend around the year 2000?

g'kar's picture

Didn't all the computers stop working in 2000?

lordylord's picture


Don't forget the acceleration in 2008 (see graph).  Wonder that is from? 

Spoiler: BushCo. bought out by ObummerCo.  Different name, same shit.


roadhazard's picture

I was responding to, " what happened in 2000". Don't get your panties in a wad, son.

daveO's picture

China most favored nation trading status. Thanks Bill Clinton.

JR's picture

The Fed oligarchs, in my opinion, are creating opposition to their political system. And when they have a system that isn’t working, to increase it is just to speed up the crash.

I think they are hoping to be able to clean up, swipe away, the banking crisis as fast as they can, but I don’t think they can; I think they are up against the economies of the world.

Chupacabra-322's picture

"I think they are up against the economies of the world."

Actually, they're up against the Ponzies of the world.

Winston Churchill's picture

The Ponzi is dead, long live the Ponzi.

Headbanger's picture

Here's the latest laughable reincarnation of that tune:

"Five years since the recession ended, robust growth should be at hand"


But me thinks what they're all really saying is interest rates are going up cause money is vanishing into thin air due to increasing defaults.


BTW:  USDJPY looking weaker:




SDShack's picture

Recovery Summer, then 2.0, 3.0, 4.0, 5.0... now 6.0. Anyone want to wager on Recovery Summer 7.0 next year?

daveO's picture

Then they're lying about rates rising, but then, it is MW. 

Renewable Life's picture

Shit, they'll be lucky to squeeze 1% growth out of the 2nd Qtr!!! Fuel and food prices are absolutely crushing people right now and the ones who can still afford it are getting "nervous" and pulling back!

Fuel might top out in the high $4 per gallon range for this cycle, but food inflation has just gotten started and that could be a 3-4 year cycle before prices ease in produce, beef and pork, if ever!! Food costs are entering a new paradigm IMO! Continual high energy costs, diminishing water supplies, and exploding global population (8.25 billion) are going to make feeding people a very expensive proposition going forward!!

Bytor325's picture

in other words, "welcome to the Eurozone 2.0"

Eyeroller's picture

Hey, 1%, that will be GOOD news!

SO MUCH BETTER than negative!


No Quarter's picture

Already paying 4.09/gal for 93

failure to perform's picture

I work with a bunch of fucktards who think everything is coming up roses. Hardly any sales to process for the last week and we couldn't make LY this month. But it's getting better. Idiots.

failure to perform's picture

I work with a bunch of fucktards who think everything is coming up roses. Hardly any sales to process for the last week and we couldn't make LY this month. But it's getting better. Idiots.

failure to perform's picture

I work with a bunch of fucktards who think everything is coming up roses. Hardly any sales to process for the last week and we couldn't make LY this month. But it's getting better. Idiots.

Grande Tetons's picture
  • Negative GDP, as reported in 1Q, is “rare for expansions,”

Seeing the Sun at night is also rare. 

WhyDoesItHurtWhen iPee's picture

Whoaa now youz bad news bears, if you figure in Hookers, Blow and Bribes, +3.0 GDP.  Winning !

fonzannoon's picture

Someone actually said "Negative GDP is rare for expansions". They then typed "Negative GDP is rare for expansions". They then looked at the words "Negative GDP is rare for expansions" and possibly showed others the words "Negative GDP is rare for expansions". Then someone gave it a final proofread and approved the words "Negative GDP is rare for expansions" for publication. 

Chupacabra-322's picture

"rare for expansions." So, in other words get ready to get reamed up your asses without Vaseline.

disabledvet's picture

Well...maybe if you contract you'll be spared.

When all the economists are saying the same thing more than likely they're doing the exact opposite.

JJdog's picture

it's all weather, too cold no one is hiring, no one is shopping, no one is buying houses.  Now that is warm and sunny, everyone is out BBQing and partying. soon the drought will cause food price inflation then people will stop working, eating. Always the weather, Yellen will confirm this. 

agstacks's picture

This porridge is too hot!

This porridge is too cold!

"Without a frank discussion on Global Climate Choas™, we will never have the right climate for expansive economic growth"

-PHd Economist


SDShack's picture

Cold weather, now droughts. Soon to be summer storms and tornados. Followed by fall hurricanes. This winter will have to be epic to drive the excuses. Real Wrath of God Biblical Proportions. Fire & Brimstone from the skies, Earthquakes, Volcanos, Seas Boiling, the Dead Rising from the Grave, Human Sacrifice, Dogs & Cats Living Together... MASS HYSTERIA!

firstdivision's picture

Feels like equity prices are being propped up for banks to secure better terms on their CDS buys while also getting better positions for selling calls for the latter part of summer/early fall.  Someone is very, very desperate to prop up NG prices, and I'd put my guess on some NG suppliers that are pushing fixed price contracts to industrials like a crack dealer on hookers. 

disabledvet's picture

That's a textbook cartel. By using natural gas for electrical generation you are guaranteeing a price support...quite high right now actually.

And the USA can't even export natural gas (yet.)

The volumes being produced and transported in the USA are staggering. To the point where imports have fallen to zero actually.

madbraz's picture

Add to this the fact that big players in interest rate bets are big-time underwater in their shorts - not entirely out of the realm of possibility that someone is tossed to the sharks and goes under.  A LTCM moment that takes the stock market into the shitter.

pound the vix's picture

GDP up GDP down the only constant is S&P UP UP UP UP UP UP UP

orangegeek's picture

Strategas "GDP -1%, old news....mostly noise"


Awesome.  LMFAO.  Just awesome!!!!  You can't make this stuff up.

Smegley Wanxalot's picture

The scapegoat for Q2 will be Ukrainian uncertainty weighing on the minds of the knowledgeable, well-informed, and globally aware US consumer base.

mayhem_korner's picture



Ukraine is what you do with your neck when you want to marvel at a jet flying overhead, no?

skbull44's picture

It's an insult to meteorologists everywhere to refer to economists as weathermen...

oklaboy's picture

Alice in wonderland got nothin on these folks.....

Space Animatoltipap's picture

Hewlett Packard and retail sales perhaps are nice indicators. 

papaswamp's picture

Inventory build will be huge part Q2 along with consumer spending in healthcare. Double bubble. Q3 could be ugly as inventory has no place to go.

HARPEX is accelerating very fast signaling a rapid outflow of finished products. BDI though is stagnant meaning future demand is flat. June data will be very interesting.

disabledvet's picture

An inventory build has been what has been missing throughout this "non recovery" recovery. Not an expert (nor an economist) but to me a lack of large inventory builds shows a total lack of faith in the recovery meme.

Chupacabra-322's picture

Also, in spite of the first actual contraction in the U.S. economy since 2011, the S&P 500 continues to skyrocket, gold continues to be illegally manipulated lower than actual market value based on other economic indicators, including surge in purchase to acquisition by India, China (and now Russia, recently 900,000 ounces, or about $1.2 Billion USD worth), not to mention the millions of private investors in gold/silver.

"Belgium" purchases the same (approx $50 Billion USD in January 2014) in US Treasury bonds that Russia dumps. The same "Belgium" that has supposedly been purchasing $215 Billion in US T-bonds since August 2013. And we know it wasn't REALLY Belgium because that nation's economy is fucked and has a GDP of approximately $500 Billion USD. So who REALLY bought up those T-bonds?

The current "conspiracy nut" money is on the ECB (European Central Bank), which would be scandalous, considering the ECB, which feeds off the sovereign debt of EU nations, and the "full faith and credit" of the taxpayers of those nations, is desperately trying to maintain economic unity in the face of massive bailouts of the PIIGS nations EU members. So where the FRACK is the ECB getting the capital or collateral to purchase a quarter of a trillion USD in U.S. T-bonds? As Ron Paul has already pointed out, there is more than a little "quid-pro-quo" back-scratching and palm greasing going on between the central banks of Western Civilization (aka The New World Order).

The recent election results in the EU have definitely shaken up the fracking "Elites" of the NWO, and their focus at this years Bildeburg conference is focusing on the fiasco in the Ukraine AND the most recent EU member state elections.

I wonder what "stragedy" these evil motherfuckers are going to come up with this time.

intric8's picture

They arent content to ruin the fundamental nature of our country. It wont stop until they destroy our sanity too. These market contradictions actually serve to repress our critical thinking skills. Black is white, down is the new good.

Chupacabra-322's picture

The growing world ruling oligarchy is hardly a conspiracy. It's actually quite hard to miss these days. Fed Chair Janet Yellen didn't deny it when asked point blank by Congress. Nobody has questioned the Princeton study that measured the country's political system as a functional oligarchy. The increasing number of crony corporations that pay no tax and are awarded monster government contracts for their compliance is no secret. Snowden revealed that elected members government are universally spied on and blackmailed, and the government (Criminal UNITED STATES, CORP. INC.) hasn't said a word to refute it.

This is all established fact. The "elite" are probably mystified right now, as they're running out of things to steal and nobody seems to care.

Kaiser Sousa's picture

all i know is Silver's phony paper price is below $19 (as london closes of course)...