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CBO "Revises" Its 2014 GDP Forecast, Hilarity Ensues (As Always)
The gross, in fact epic, incompetence of the Congressional Budget Office when it comes to doing its only job, forecasting the future state of the US economy, has previously been extensively documented here (and here and here and here). This incompetence is in the spotlight once again this morning with the CBO's release of its latest forecast revision of its original February 2014 projection.
And while every aspect of the revised projection has changed, in an adverse direction of course, the punchline is the chart below: the CBO's revised projection for 2014 GDP. It's one of those "no comment necessary" visuals.
Surprising? Hardly. After all the CBO is swarming with indoctrinated Keynesian cultists whose only achievement in life is to be wrong about everything (and then to blame the Fed for not "easing enough"). Here is how the CBO "explains" this 50%+ cut in its forecast in just 6 months:
CBO has lowered its projection of real growth of GDP in 2014 from 3.1 percent to 1.5 percent, reflecting the surprising economic weakness in the first half of the year.
Which as other Keynesian talking heads have already made quite clear was due to snow. That's right: over $100 billion in forecast economic growth "evaporated" from the US economy because it... snowed.
The good news? The CBO refuses to forecast the "harsh weather" for the foreseeable future, and has kept all of its 2015 and onward GDP estimates as is. So when things go horribly wrong to the CBO's forecast, which is 100% guaranteed to happen, the CBO can again blame "surprising economic weakness" because, well, everyone else is doing it.
Those who wish to waste their time can find the source here.
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hey ...its an honest mistake..;-)
How much did these charts cost us?
I mean WTF - lmao.
Incompetence? Tyler why do you provide cover for blatantly criminal activities?
It's OK.....that's a hell of a lot of pressure to be under.
Mulligans all around.
Perhaps they could save some money if they didn't use colored charts...
I will offer to takeover the CBO's job of forecasting GDP for the reasonable sum of just $1 million per year.
I guarantee that (just like the CBO) actual GDP will fall within 100% of my projections.
So, what say you?
Well this should be great fucking news for the CBO and the rest of the Keynesian Creeps:
There's a verrrrry looooong, cooooold winter a comin'....
I have a cost saving measure. Replace the CBO with a dartbboard of GDP numbers and a drunk frat kid, I guarantee higher accurancy.
I believe they're on their 6th mulligan and they still aren't out of the tee box.
One and Done, baby. Just look at the chart.
GDP is an obsolete relic of the idustrial age. The post industrial era is beyond producing objects and viewing ourselves as consumers. We are world citizens who need to understand our place in the universe and seek happiness and contentment in the manufactured landscape of central planning.
OK, sure. But the polite thing to do is play along and let the economists feel like they're doing something important. We all have a role to play in the new world order.
Excellent post, Al. We are all being vastly impolite...
Teats on a boar hog and all that.
Not sure which is worse, the annual Hurricane Predition # or CBO expectations? Whichever, why bother???
In most parts of the USA being so wrong professionally is a pretty quick route to a judge and jury -up on malpractice charges.
Or at least getting permanently fired. (I don't think we have the political will yet to actually hold lawbreakers accountable to legal punishment - as we've seen plainly with Obama, Holder, and Bush's crop of lovelies, etc.) And we know how many bills are written on the backs of these awesome CBO estimates, and how many have been in the past (Medicare, Medicaid, on and on...) Any wonder the USG over $100Tr. in current and future debt liabilities, with these boys and girls counting?
More hockey sticks than the Stanley Cup.
CBO "Central Bullshiter Operations"
Loving the "LOL!" caption for 2014.
Thit chart will piss many people off. Especially the jamokes touting the recovery.
I don't think there is one institution left in this country that isn't completly corrupted and fucked up. If a big dumb guy like me from Indian knows where things are headed then surely they know the truth as well. Which can only mean that when it's really bad you have to lie.
Do bears still shit in the woods in Indiana too?
Sixteen years and I've never seen a bear here. I did see a fine herd of deer this morning and they looked nice and healthy. It's going to be a good harvest this year.
http://hunt-indiana.com/thread/49700/black-population-moving-closer-indiana
Well, when the show up...pretty sure they will be shitting in the woods.
Or in the yard if the spirit moves them, so to speak.
You probably have bears in the Tetons and the article you posted said they are getting close to Indiana but Texas ain't got no bears and we don't want any. We'll shoot them faster than we would an alien.
Trust only your local gun store, auto repair shop and butcher. Question everything after that.
Everything is going exactly according to their (TPTB) plan.
Buckle-up for the next great redistribution of wealth up the food-chain.
“In the magical universe there are no coincidences and there are no accidents. Nothing happens unless someone wills it to happen.”
William S. Burroughs
Keep stackin' brethren...and happy boating.
With all the pretty red, white and green (and downward GDP revisions), I thought it was an article about Italy. Madonna!!
Just wait until it snows again. The we'll really be in trouble.
This is terrible! What if it snows this winter? What the fuck happens to the economy then? Damn this weather phenomenon!
Farmer's almanac says it's going to be a cold one this year.:
http://abcnews.go.com/Weird/wireStory/farmers-almanac-predicts-nasty-win...
What? We just got through winter this summer.....where has the time gone?
Where's the huge economic surge they promised coming out of that? ;)
Jesus.. SNOW!?!? OMFG.. that could fuck up Everything for the Entire Year!
It's global warming.
Is it just me or do the years start running backward on the chart? I think the CBO be smokin' the strong stuff while on the job.
Time travel predicted in the last chart!
But, but, but Ambrose Evans-Pritchard said the US recovery was underway at 3% !
/sarc
Maybe Ambrose might now more fully appreciate Lars point of view of American economic statistics...
FRAUD is dangerous not hilarious.
But when everyone knows it's fraud? Heads nod up and down: "that seems more correct, yes". It's fuck total Kabuki, theater of the absurd. Yes comical.
Like brains numbed by novocaine.
"CBO has lowered its projection of real growth of GDP in 2014 from 3.1 percent to 1.5 percent, reflecting the surprising economic weakness in the first half of the year."
Don't you see the brilliance in this approach? They have effectively lowered the bar so the MSM can proudly proclaim GDP growth beat this lowered estimate (if it happens). Further, if GDP growth is not on pace to beat this lowered estimate, the Ministry of Truth can simply reformulate GDP until it does. Lowering the bar now makes it that much easier for the Ministry of Truth to fudge the data to get GDP over the bar. Voilà! The MSM could then declare this to be more evidence that economic growth has reach escape velocity. Stawks to da moon!
FUBAR.
Surprise!
This truly is a moment in history.
Wait'll they see the surprising economic weakness in the second half of the year----then they gone shit themselves. Reality is a bitch when you been dreamin.
If they guess within 5% of reality they all get cigars.
If they guess above 5% they get golden parachutes.
Otherwise, it's time for golden showers..
Hell, if they get the direction right, the get cigars.
They are soo good at projections! Green shoots abound!
Was just going to ask how the weather was overthere but then i read the comments.
I prefer to look at corporate revenues--which as luck would have it, are barely positive inclusive of inflation whatever that rate is.
when this whole thing collapses most people will be shocked and surprised.
gold might not do well only because who will be left that can afford to buy any.
Think about the HNW individuals in highly leveraged funds whether stocks or bonds or real estate. They will all have wished they had bought some of that crappy PM that has gone nowhere and does not pay interest.
yes.. the Sheeple will say: WTF OBAAAAAAMAAAAA??? LOL!
Thus due to weaker revenue...all that Ocare that was going to be covered, probably wont be, thus an increase in debt (already an increase $965B this FY). Must print moar.
Ah yes, the snow. Which is why Arizona and Nevada - well known for the torturously cold, blizzardy and economy debilitating monster dumps that so often plague the states from November to April - had their 1.6% and 1.5% growth in Q1&Q2 2014. There's one thing we can count on - the CBO will ALWAYS live up to its name (Congressional Bullshit Office - or Oriface, to be technically accurate.)
Time for this country to start counting hookers and blow. That should be worth $500 billion in Washington DC and New York City alone. If memory serves me correctly, we, according to the CBO year 2000, 10-15 year projections should currently have an account surplus. Missed it by $17 trillion.
Yes but what is "significant" really?
saw a report the other day that there are 82 million on medicaid, 51 mil on food stamps. and still have 33 million to be insured probably under medicaid.
add in the 55 mil on soc sec/medicare-thats 115 mil on medicaid and 55 mil going to 60 on soc sec medicare--total 175 receiving benefits with basically no prefunding.
We only have 120 million working full time and not too many of those are on wall street (not enought there to tax at 100% and meet obligations-infact, we could double personal income tax revenues (on everybody paying income tax) and just about break even for a few years. until interest rates go up at least. However, what do you do about the mid income people earning say 75k a year seeing their taxes double and then they have to cut spending--not to mention higher premiums coming for obamacare.
so it comes back to the question of when, not if, do we have the "oops" moment when we cannot meet payroll. Just like what happens in real companies in financial trouble.
I'd also say some of th eimproved cash flow deficit is duw to the feds deferring paying invpices from vendors and the fed employees pension ala Illinos way of dealing with deficits.
numerous routes likely to trigger the oops moment.
Well, it's nice to know this won't impact any budget planning since there is no budget planning.
i'm not sure what keynes (state is providence for the people ie public services shall be public, financial markets shall be regulated etc) has to do with the QE joke (fed is providence for the banksters).
it's like blaming Marx, probably the best economist of history (read "the capital") for Staline murders.
but i could be wrong, those lessons i had on keynes starts to date, so please enlight me.
Unfortunately there are only two possible results in their world:
1. Missed estimates >>> pent up demand >>> economy back on track shortly >>> all is good very soon
2. Hit Estimates >>> economy on track >>> all is good
Monkeys at a typewriter!
Winston Smith lives!
An American, not US subject.
CBO....bunch of Capt. Hindsights.
The only word that comes to mind is KEYNESIANS. Why do they continue down this path of failed Economics? By the time the dog leaves the White House, "BO" ,our National Debt will be over 20 Trillion and our GDP will be negative yet there will be some way to justify their total failure...
where the fuck did you people read in keynes writing that QE is a keynes theory ?
Imagine if the 100+ million Americans that rely on food stamps and other Government handouts actually had to get a job or start a business to survive? Imagine if these people actually produced something other then debt? It's called Capitalism and when people produce instead of take it adds money to an economy instead of sucking it dry.
oh you're stuck in demorep paradigm not realising the only parasite in the picture are the feds & the senate & all their mates (& the weapon sellers).
ok then i feel for you
"where the fuck did you people read in keynes writing that QE is a keynes theory ?"
Keynes advocated deficit spending by the government to 'spur' the economy, with corresponding surpluses when the economy was doing well. (Guess what we never get to the surpluses.) QE accommodates massive deficit spending..so QE is a massive, perhaps grossly distorted extrapolation of Keynesian theory. So lamenting Keynesians these days, is to lament the grossly distorted Keynesian theory, imho, although clearly Keynesianism has not worked out well in practice, so some lament can properly be leveled at him for being a polyanna who trusted government could by and large do the right thing.
nothing can work with that central banking system of ours & this fucking reserve rate paradigm; so it's all bs to create the illusion of a debate.
this being said :
ok with grossly distorted but :
my gross understanding is that keynes main aspect of his model is that financial markets should be regulated by the state all the time vs the friedman neo-lib model that intend to prove that financial markets should be totally free of rules & regulation all the time as well (all this based on the sweet utopia hypothesis that information on markets is transparent, i'll get back to that).
the keynes model is about regulation all the time, not only during one crisis after decades of free unregulated markets, after decades of us government policies following entirely the neolib model... so imo, that's a sufficient reason to just stop with that keynes/neolib debate and see how bs & irrelevant it is.
the model the government follow is neither keynesian, neither neolib : it's all the profit for the 1% and all the losses for the rest.
finally, if the system was not corrupt, i want to add that financial markets would need to be regulated somehow by the state (a state that'd be above banks & for the people - another sweet utopia of mine) for one very simple & straightforward reason (and some years ago in the 90's if my memory is ok, some economist got the nobel price for proving what's follow) : the information on the markets cannot be transparent (which is the card on which all the neo-lib model/castle relies).
Silly Tyler, same as the MSM, their only job is to get liberal politicians elected and unfortunately for America, they're pretty good at it.
GDP is a bullshit statistic anyways. 18% of GDP comes from health care in this country, and will only increase in the coming decades. Unpossible and not a very sound way to spend ones money. Throw in the fact that, according to those who control the purse strings, feel that, the war on terror is only in the first quarter, (neocons love talking about a 50 year war) the GDP to debt ratio will never be better than it is currently. We still spend more than we take in, sooner or later, it fails. They can't print and hold (which they are obviously doing now) just look at M2 (bad for GDP) and they can't let it out (hyperinflation).
How about this? Like fuel and food toward inflation, the government can just not include the winter months in its GDP projections.
They'll just call it Core GDP*
*does not include winter months with lots of snow across much of the US.
With such large % swings between estimates , is any of this data even worth anything?
I can explain; they backed out the QE. There, fixed it for 'ya!
The economists did not predict the snow effect and their predictions fell short. It reminds me of their climate science brethren. They must both be using the same super-dupe-computers and programmers. GIGO.
Whoops I notice I missed the 'R' in "super-duper" but left it that way as it somehow seems more appropriate.
I forecast a GDP reading of 1.85% next year. Anyone wanting to bet?
As long as the SP makes new highs, it doesn't matter.
The stuff dreams are made of.
The real "LOL!" is the estimated jump up from the first red bar to the second green bar. How shameful. I call upon the individuals that do the real analysis that lead to the results that are shit canned, manipulated (assumptions), and altered to turn whistle blower.
Well, if cutting your GDP forecast from an increase of 3.1% to an increase of just 1.5% represents incompetence, what do we think of web sites that have forecast 20 of the last 2 recessions and the end of 5 of the last 1 hegemonic empires?
Im not surprised.
This is more of a prediction than a forecast and predicting the future is an impossible task, a fools errand, full of pitfalls. Still we listen and soak in all that is said, we even spend a tremendous amount of money to gain an edge in knowing what maybe just around the corner. If you step back ten years in your mind, I suspect that things have not unfolded as you might have predicted.
When you see how the world has developed, the twist and turns are most unpredictable. Nowhere is this more apparent then in the economy, whether it is in the areas of interest rates and inflation or the rise and fall of companies. Surprise and awe, highlighted with bouts of shock is what we should expect going forward. More on this subject in the article below.
http://brucewilds.blogspot.com/2013/06/predicting-future-and-hindsight-m...
Snow in winter.
In other news,
Bear poops in woods.