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And The GDP Downgrades Begin: Goldman Slashes Q3/Q4 GDP

Submitted by Tyler Durden on 10/15/2014 11:19 -0400

Remember the data-dependent recovery, which until the NFP report two weeks ago, could seemingly do no wrong. Well, according to Goldman the recovery party just ended.

From Goldman's Kris Dawsey:

BOTTOM LINE: Business inventories rose less than expected in August. In light of the disappointing September retail sales report and slower-than-expected inventory growth in August, we reduced our Q3 GDP tracking estimate by three-tenths to +3.2%. We also moved our Q4 GDP forecast down a quarter point to +3.0%.

MAIN POINTS:

1. Business inventories rose 0.2% in August (vs. consensus +0.4%). Retail inventories—the only component of the report not already known for the month—declined 0.3%. Auto and auto parts inventories declined 0.7%, while ex-autos inventories were flat.

2. In light of the disappointing September retail sales report and slower-than-expected inventory growth in August, we reduced our Q3 GDP tracking estimate by three-tenths to +3.2%. We also moved our Q4 GDP forecast down a quarter point to +3.0%, due to weaker momentum in consumer spending heading into the quarter.

So is this just the "bad news is good news" that the algos were looking for?

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Wed, 10/15/2014 - 11:22 | 5334222 observer007

Ebola nightmare scenario

The nightmare scenario: a mutating Ebola that spreads… The Ebola virus circulating in West Africa is already different from previous strains.

Latest:

http://tersee.com/#!q=ebola&t=text

Wed, 10/15/2014 - 11:25 | 5334238 kliguy38

Muppet stew

Wed, 10/15/2014 - 11:54 | 5334399 stinkhammer

god's work

Wed, 10/15/2014 - 12:06 | 5334496 madcows

even bankers need to eat.

Wed, 10/15/2014 - 11:26 | 5334246 hankwil74

No time to panic. They'll be plenty of time for that later

Wed, 10/15/2014 - 11:27 | 5334258 Spastica Rex

I would love to be terrified of Ebola, but I'm not really following what it is that the link you provided really shows.

Wed, 10/15/2014 - 11:50 | 5334384 ShrNfr

Not really. There are four strains. This is one of them that has been known about. After having said that, this stuff mutates while you watch and might become something different in short order.

Ebola strains
There are four strains of Ebola virus that have caused illness in humans. They are named after the region where they were first detected: Bundibugyo, Tai Forest (previously known as Ivory Coast), Sudan and Zaire. A fifth strain, Reston, has been identified in monkeys in/imported from the Philippines, as well as in pigs in the Philippines. Reston has caused asymptomatic infections in humans. This means humans have been infected with the virus but did not get sick.

Wed, 10/15/2014 - 11:22 | 5334227 TruthInSunshine

Oh yeah? But what does Tom Stolper believe and/or publicly proclaim?

Wed, 10/15/2014 - 11:23 | 5334236 knukles

What a buncha overly optimistic bullshit

Wed, 10/15/2014 - 11:28 | 5334253 DoChenRollingBearing

Goldman a little late? Naaaaahhhh... Unless they are doing all of this on purpose. Because there is NO WAY that an amateur Bearing Guy could beat mighty GS to this...

"Deflation First, Then Inflation?" http://goo.gl/NRArHa

Wed, 10/15/2014 - 13:29 | 5335259 lasvegaspersona

hezzzz baaaack

Wed, 10/15/2014 - 11:30 | 5334281 pods

I cannot even believe that people would even think this is correct. Well, those not connected to the $$ spigot.

This is laughable. Lala land.

In the real world, we are doing more with less, ate the seed corn a couple years back, and now are enjoying mud cookies while we wait for the Goths to come.

And lemme tell you, the Morlocks are getting hungry.

pods

Wed, 10/15/2014 - 11:24 | 5334232 Dr. Venkman

Bad news is bad news until Yellen's speech on Friday.

Wed, 10/15/2014 - 11:24 | 5334235 Temporalist

GDP - God Dammit Print <Bitchez!!!>

_{There was bad weather somewhere in this solar system}

Wed, 10/15/2014 - 11:25 | 5334240 Tenshin Headache

Retail sales are going to completely crater in Q4 thanks to the new federal Ebola Importation Program.

Wed, 10/15/2014 - 11:25 | 5334241 Shizzmoney

Took em long enough

Wed, 10/15/2014 - 11:26 | 5334247 Spastica Rex

Better late than never!

Suckas!

Wed, 10/15/2014 - 11:27 | 5334266 saints51

This is one of the weirdest days I have ever seen in the markets. The price action has no rhyme or reason. Spikes all over the place. Clearly algo infested.

Wed, 10/15/2014 - 11:35 | 5334321 Osmium

Thank god we have HFT to provide liquidity. Otherwise the markets would be red, wait a minute...

Wed, 10/15/2014 - 11:50 | 5334381 saints51

hehe I hear ya on that one. When I saw TF this morning gap down then slam, with a huge upward move out of nowhere, I said to myself one of those days. Then it just got weird at the gap fill. I know price consolidates but this was a picture perfect day of WTF am I seeing. Price is close to US open. I would not be shocked if we ramp up before close, just because it should go down. IDK as I am on sidelines rest of day. The past couple of weeks have been great. Monday was easy day but Tuesday and Wednesday have been like a red headed step child throwing a tempter tantrum.

Wed, 10/15/2014 - 11:52 | 5334386 MATA HAIRY

down goes ZH!

Wed, 10/15/2014 - 11:54 | 5334406 NEOSERF

This is classic Wall St. run it up and run it down trying to force the Fed to continue QE. This is also a huge opportunity for all companies to load up their Q3 numbers with all the stuff they've been hiding as there won't be any ignominy in it when everyone else is doing it to. Trying to set the plate with clean balance sheets and new Fed QE for a smashing 30% up year in 2015...muppets indeed.

Wed, 10/15/2014 - 12:00 | 5334442 JustObserving