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Why Did Q3 GDP Jump: Thank ISIS And The "War On Terror"
As we noted previously, the main reason why Q3 GDP surprised to the upside was thanks to yet another accounting gimmick, where it wasn't the US consumer leading to US growth, as has historically been the case, but because the government stepped up, and boosted GDP by the most since Q2 2009.
So just which aspect of government taxpayer fund recirculation was responsible for this sudden boost in US "growth" (leaving aside the philosophical debate whether government capital allocations ever lead to grwoth)?
The answer is shown in the chart below showing the quarterly change in US National Defense spending: at by $30 billion, it was the most since 2008!
In short: thank you ISIS and renewed war on terror.
And what is more disturbing, as we noted earlier, is that the Fed had this data when it decided yesterday to end QE and to present its "surprisingly hawkish" assessment of the economy, suggesting the Fed is comfortbale with defense spending as a marginal leader of US growth (and is also not seeing any snow whatsoever this winter)
So... the "Fed war put" anyone?
Source: St. Louis Fed
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printers, beans and bullets
you forgot a third war, the war on our liberties...more drones, more spying, more volunteer quarantines...
YES!
Someday this war is gonna end.
https://www.youtube.com/watch?v=bZP6BV15fc0&feature=player_embedded
Obama's wars are great wars. Obama's wars are great wars. Obama's wars are great wars....Blame Bush. Blame Bush. Blame Bush...And Reagan. And Reagan. And Reagan...Racism...Racism...Racism...
The 2009 Nobel Peace Prize winner has just hit the GDP jackpot the week before the elections... How would have guessed...
The Fed is comfy with anything that keeps the charade going.
Another of the dozens of reasons for the fake ebola scare.
Spending increases the GDP #'s.
"The primary aim of modern warfare is to use up the products of the machine without raising the general standard of living."
slave paying tax to the master, the master spend it , make a report and showing that the economy is perfect.. great strategy
Dropping bombs on brown people > white people shopping.
warring as a boost to GDP. why not? it's the only industry we haven't outsourced.
except for blackwater and a host of other mercs who are also playing the part of ISIS, the sworn enemy.
Whew! it gets so confusing, but I guess none of that matters. I mean, did you see that spike in GDP?
Remember what I said?
Pentagon is taking over the Fed now.
Bank lobby will be dead soon, if not dead already
Prepare for the Junta, like in the 60s and 70s
There is still 4% GDP that they still made up any way. I think shrinkage is declining from minus 4% to -2 or minus 1% due to Pentagon.
You also said something about Saudis, Chinese and oil.
What happened with that pontification?
everything fully proven, except for my call that there will be a margin call before december 31st 2014.
Still waiting on that one
Thu, 10/23/2014 - 08:57 | 5366875 LULZBank
So you reduce the price, so the Chinese can also do it on the cheap?
Thu, 10/23/2014 - 08:58 | 5366886 ekm1
How can they buy saudi oil if saudis decided not to sell oil to them?
You still think there is a free market?
Is that a joke?
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And from yesterday:
Mysterious Chinese Buyer Of Record Crude Oil Cargoes Revealed
So whos proven right, you or me?
LOL
21 million barrels. 3 days of consumption for china AND 1.2 days of consumption for usa
Is that your best argument?
You think they ONLY imported what was reported by Bloomberg.
Just like their Gold imports, all transparent?
But yeah... carry on pontificating!
China is just too far to help saudis defend from Iran.
http://www.mybfolder.com/pics/5195-1270679518.jpg
Agree. That is why I only pontificate and almost never provide any links as "proof"
Then you are not helping anyone here, let alone your reputation. Anyone can pontificate about price, movement, or growth. But truly no one has any clue, not even the ones manipulating that data and currencies.
It's tiresome to come looking for facts in preparation for the inevitable collapse and read tarot card bullshit.
To paraphrase Joan Rivers "I spit on inner beauty".
Let me repeat this again:
I spit on my reputation
True story:
I was once saw this Priest, holding a copy of Bible, preaching in a shopping area. SOme people gathered around him and started asking critical/cross questions to which he had no logical asnwers to.
Until he got really frustrated and threw the bible on the pavement and said "Im not a Christian."
Total LULZ, I tell ya!
:-)
except for my call that there will be a margin call before december 31st 2014.
Still waiting on that one
You mean you're gonna troll here and goose some bears till end of the year and then disappear till sometime Q3 2015 to reappaer for your usual tricks?
When in doubts, start a war.
Does today's definition of GDP include...
1. Hookers
2. Crack
3. Broken windows
4. Recycled welfare money
?
Hookers and crack are definitely included in Europe.
http://www.google.co.in/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja...
How exactly does one have a war on terror? Does that mean no more scary movies? Does Halloween get outlawed? Do we make Hillary Clinton where a bag over her head and cover up her kankles when she goes out in public? Seems to me that the war on terror needs to start with cleaning out the terrorists in Washington.
If only we could get that on the ballot. Instead we have a glass half full of hemlock and a glass half empty of strychnine. You get a choice you know.....it is a fair election after all.
I will be voting against all incumbents.
The lesser of two evils is the one not in office today.
Maybe it will help you feel better, but its completely futile. I'd say dont participate. The only message we could possibly send to scare .gov is to tell them we dont believe their dog and pony show.
The same way you have a war on poverty or drugs....by making more of the thing you are fighting a war against! And I couldn't agree more with the 'cleaning out the terrorists in Washington'.
Just like people who fly an American flag made in China.
HEAR FUCKING HEAR!!
Nothing changes until K Street burns.
I laughed when that guy yesterday ran over a zombie on the highway. It was too funny.
and apple ceo is a fag
You go Seth, good to see some true ZeroHedgers here! Call it like you see it!
No gay Apple shit for me.
Samsung and Microsoft say thank you very much Tim Cook, you homo!
Yeah! And he's tall and has white hair!
proof that even God makes mistakes....
next will be Ebola boost the GDP.. wohooo...
HazMat suits are the latest craze, a must have for every wardrobe.
THANKS BE TO THE CIA AND THE MOSSAD AND ALL THE OTHER BLACK BOX GOV'T AGENCIES THAT FUNDED ISIS AND CREATED IT TO SERVE AS A SOCK PUPPET "TERRORIST" ORGANIZATION!
THANKS BE FOR THE "BOUGHT AND PAID FOR" BEHEADINGS THAT MANUFACTURED CONSENT FOR THIS WONDERFUL WAR MACHINE SPENDING!
THANK YOU JANET YELLEN AND THANK YOU JESUS FOR THIS NEW WAR!
Why would the CIA and Mossad create ISIS? Just curious and trying to get myself into your psyche
in my psyche is not a good place to be...trust me on that!
War, what is it good for?
<Well now we know.>
War is the theater presented on the stage, while its supporting angels making a killing in the surrounding concessions generated.
nothing like the smell of napalm in the morning....
Government spending is reported to be up just because it is the only input left that could have goalseeked GDP to this level, it's as simple as that.
Can't have GDP crashing before the election. People might vote against the incumbents.
Sure the incumbents suck, but their opposition are the same meglomaniacs that believe government can help anything and everything everywhere. Sitting out my first election in 18 years and plan to sit out many more. I do not consent.
Who's going to pay for all these wars and with what money?
I can see soldiers waiting for ammo and the suppliers waiting for coin before they give it.
Wait til they put .gov on .cod :)
Guess they will have to fight like Zulus.
http://www.youtube.com/watch?v=d17vfJ7bUVo
Those companies will be nationalized long before that happens, you know, for the safety of the childrens...
I think the merger already took place.
The longer the charade continues, the more time we have to prepare for the unmasking. Government spending and petroleum are keeping this country afloat. Dropping oil prices and a credit crunch are going to hit us pretty hard. Lots of people in the oil patch making six figures and paying a bunch of taxes right now. Hard to buy all those tomahawk missile without that revenue. Wait...what am I saying? Just print moar.
Just think if only the US went to war with even more countries how good the GDP would be!
The Tribe is in complete control now.
The Tribe Thinks it is in complete control now.
It's the election. Huge Obama stat pumpathon before voting. Lower gas prices.
This seems like a Chicago political machine production.
The Chicago Way from the ultimate con man.
The line "A 10% jump in federal spending, mostly on Pentagon hardware, also bolstered growth. It was the biggest increase in federal spending since 2009, when the Obama administration put in place a huge economic stimulus package." says it all!
We should understand that demand drives investment, confidence is not the real driver. Lack of real growth is about lack of real demand. Much of the demand we see today is driven by artificially low interest rates and QE that distorts the markets. We must differentiate the kinds of economic growth and understand that all growth is not created equal.
If you spend money but afterwards have little to show for it you have wasted it. Sadly, much of the money America "invests in itself" each year through government spending and programs falls into this category. More on the kind of growth we need in the article below.
http://brucewilds.blogspot.com/2014/01/false-demand-fuels-wrong-kind-of-growth.html
Krugman's head is probably the size of the Goodyear blimp so he can't get out his front door to gloat this morning.
Moar broken glass...
THIS IS NOT DEFENSE SPENDING. OFFENCE HEDGOMY OF REGIME CHANGE. Immoral war profiteers and yes look in mirror war and security fascist.
But Krugman said war is bad for the "economy"?
"And what is more disturbing, as we noted earlier, is that the Fed had this data when it decided yesterday to end QE and to present its "surprisingly hawkish" assessment of the economy, suggesting the Fed is comfortbale with defense spending as a marginal leader of US growth (and is also not seeing any snow whatsoever this winter)"
So they either have confirmation that the war effort will accelerate OR they think we are too stupid or too few in numbers to understand this and then force something to happen.
It is, after all, the first year of the College Football Playoffs. We are going to be distracted until at least the first part of Wintergeddon II.
I bet the fed didn't know it was defense spending that drove up gdp, bet they only knew the headline.
Waiting for Volker to come out and side with Greenspan on trashing QE and suggesting gold.
Come on Paul ... be a stand up guy.
The ultimate broken window fallacy...
These gdp numbers are simply not believable as usual. A military intervention in Syria/ Iraq with 1500 or so boots not on the ground and a show of air power boosts the gdp by this much. I'm not buying it. It doesn't pass the smell test. What does pas the smell test is that there is an election on Tuesday and the number must be acceptale to the administration.
Rivisions
You things are bad when revisionists get to control the front and back end.
Looks to be right on track to me...
Why the hubub?
Every week the same stories about .gov lied and blah blah. It's a well worn meme. I still like to keep an eye on things, but getting fired up over another legal fiction is beyond me at this point.
Nobody can do anything because the whole system is a rotten bucket of crabs. Any crab that tries to stick up gets dragged back into the melee. Proud nail and all that.
We are all just sitting around waiting for the carcass of this Nation State to finish rotting... You can pretend to have a choice if you wish. You can even choose to move to another carcass of a different rotting Nation State. Freedom of Choice!
WHY DID GDP JUMP?
Because the elections are Tuesday. Next question.
Totally... It will be revised down later.
El facismo!
For the non doomers n gloomers; aka the Krugmanian brigade, this is the proof of the pudding :
QE STOPS but Q3 growth ramps on.
So...if Oil prices collapse, if the $ economy ramps up in terms of $ Uber alles, and if the real economy gets a hard on, how can the doomers n gloomers say its all thanks to ISIS. Maybe its all thanks to Orisis!
Just saying it to keep the debate open.
Nothing is written in concrete, neither the continual rise of Pax Americana model nor its imminent demise!
Chew on that fellow ZH forum members!
Didnt every American Blue Chip companies earning miss expectations last week? How is this possible?
fedgov spending ramping should surprise no one for two reasons
1) use it or lose it. FY for fedgov ends sept 30th. Every department that has any $$s left must spend every last one so they can justify increase to their budget
2) election. The administration knew damn well when this number came out ... kitchen sink spending quarter
Maybe, but 3Q spending hardly rose last year.
More terrorist means good news for the economy.
Fucker looks like Charlie Crist turned inside-out. Of course he's queer. NTTAWWT.
The US air war against the Islamic State costs $8.3 million a day
28 October 2014, (Agence France Presse - Raw Story)
http://www.rawstory.com/rs/2014/10/the-us-air-war-against-the-islamic-state-costs-8-3-million-a-day/
So $8.3 million GDP growth a day. Zorg explains https://www.youtube.com/watch?v=Tt1W0F0yObg
And when is reality suppose to hit these markets? We are living in interesting times. The age of cartoon accounting, lies and backroom deals can not go on forever or someone has figured out how stop from history repeating itself for the first time in history.