Q3 GDP In Question As Inventories Stumble In September

Tyler Durden's picture

While excuses will fly  - "it was the storms" - which apparently did not interfere with massive beats in housing data, the wholesale and retail inventory data stumbled hard in September. The prints were considerably worse than expected and throw more shade on Q3 GDP growth expectations.

 

Retail Inventories tumbled 1% MoM in September - the biggest drop since Aug 09...

 

And wholesale inventories rose at just 0.3%, missing expectations...

 

Notably, motor vehicle inventories dropped 2.6% MoM in September (but remain up 3.8% YoY).

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LawsofPhysics's picture

Time for some winter channel stuffing...  ...bullish (because everything is)!!!!

Dewey Cheatum and Howe's picture

Yeah..Kondratiev winter channel stuffing.

FreeShitter's picture

It wont matter, GDP will be whatever our khazaarian overlords want it to be.

DavidC's picture

Agreed. When GDP is based in ever inflating dollars, includes government spending, R&D and drugs and prostitution, what the hell does it indicate?

DavidC

BandGap's picture

And still includes fucking ObamaCare.Isn't that about 1/3 of the overall GDP at this point?

That shit is whistling at high speed towards the fan blades. It will hit by the end of the November, I believe. That is when the sign up is complete. Another way to piss off the populace.

LawsofPhysics's picture

Correct, demograhics are a bitch.  The other 60% is useless financial "products".

"Full Faith and Credit"

DavidC's picture

Meanwhile the Dow, pre market, is back over 23,400.

Sheesh.

DavidC

LawsofPhysics's picture

Indeed.  But I have to keep reminding myself that since 2008 The Fed has provided enough liquidity (directly or indirectly) to raise prices by 1,500-1,600%.

I believe you said it already, in this "market" good companies (in a GAAP world) don't always make for good stocks...

 

spastic_colon's picture

any bets on by how much GDP will beat??

gatorengineer's picture

Does it matter? its bullish if it beats (were doing great)  or misses (Moar QE).....

SimplePrinciple's picture

Lower inventories is a leading indicator for higher GDP as those inventories get replaced.  If the reason for lower inventories is higher import prices, then it would also indicate more inflation going forward.

LawsofPhysics's picture

But Mr. Yellen says that there is "no inflation", just look at the Federal Funds rate...

"Full Faith and Credit"

SimplePrinciple's picture

Yeah, uh huh, just look at food, lodging, medicine, and education.  Oh, I forgot, hedonics probably says it all gets better and better, so of course it costs more.  For example, the 2% lactose-free milk I get at Costco went from $8 to $10 recently, but now it is, drumroll, organic!  It is just so much better that in the hedonic world it probably now costs less, even though I have no choice but to pay more.

PS The wife just bought 5 $1 "World's Finest" chocolate bars from the school kids.  It took her 5 days to eat em, about the same time it used to take to eat a single $1 World's Finest chocolate bar in years gone by.  No inflation there! 

LawsofPhysics's picture

Do I really need to tell people what sarcasim is?

fucking sad.

gatorengineer's picture

I think there is an extinction of demand going on and these inventories wont be replaced.....  Christmas is setting up to be a disaster....

BandGap's picture

Big seller for the holidays will be the new crossover CD from The Federales Reserves, including their smash hit "Yellen Says".

Things will be at the burst point in December. We just need a prick. Pick a prick, any prick.

Juggernaut x2's picture

We bought the kids discounted 2018 season passes to Great America- that's their gift- we are done- fuck all of the Made-in-China crap under the tree.

SimplePrinciple's picture

Yes, if the things you need keep getting more expensive, there is less left over for the things you merely want.