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Revised Q2 GDP Prints At 1.0%, Below Expectations Of 1.1%, Down From Preliminary 1.3%
The first revision to Q1 GDP printed at 1.0%, down from the preliminary Q2 GDP print of 1.3%, and as expected was worse than Wall Street consensus of -1.1%, although it was certainly not as bad as the miss to the preliminary number. Stone McCarthy's forecast of 0.7% is not necessarily wrong: it is probably just early: the final revision to Q2 GDP will come on September 29, one week after the next FOMC meeting, and will be the last sub 1% GDP growth number before we see a negative GDP print for Q3. Personal Consumption printed a little better than expected at 0.4%, higher than consensus of 0.2%. Alas, this number will be whacked massively in Q3. Core PCE was also slightly higher than expectations of 2.1%, coming at 2.2%. The components of the 1.0% revised GDP were: PCE: 0.3%; Fixed Investment: 1.01%, Change in Private Inventories: -0.23%; Exports: 0.41%; Imports -0.31%; and Government consumption -0.18%. This is the third consecutive quarter in which the government has taken away from growth.
Full breakdown below:
And here is why any rumors of a US recovery are greatly exagerated:
And here is Goldman's breakdown:
1. Q2 real GDP growth was revised down to 1.0% (quarter-over-quarter, annualized) in the second estimate, down from 1.3% in the advance report. The revision reflected a reduction in the contribution from inventories to -0.2 percentage points (pp) from +0.2pp previously. Final sales growth-GDP excluding the effects of inventories-was revised up to 1.2% from 1.1% in the advance report. Changes in the components were in line with our expectations. Consumer spending and business fixed investment were revised up, but net exports were revised down. Other components were close to unchanged.
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The thump you just heard was the recession falling into line..
or liesman's chin dropping
This print gives bernanke a little cover to justify NO QE3.
Later will be revised nto neg .5.
It will be revised subzero in a quarter anyway...
Even the revision will be a lie.
Bullisht.
Ah, a big nothingburger. Kind of like what I expect out of the Bernank in an hour or so....
Big fence straddling waffle-fest....the Bernank LOVES being able to hold out the carrot on a stick without having to deliver a thing.
Ben said "I don't want no Stinkin Sub 1% Print before my speech"...
He has spoken and so it was done...
Who didn't see this coming???
That IS a tasty burger! Vincent, ever have a Big Nothingburger?
(Vincent shakes head no.)
Now that is just one of the finest fucking scenes in the film. Right up there with Bruce Willis and Vig Rhames in the basement....
"Do they speak english in what?!"
pods
Say "what" again!
nothingburgers suck
At what point today will equities realize there is no QE coming (yet).
Probably never.
For some reason I feel that they'll be able to spin it around to reinforce the bull.
"No QE means everything is great, so buy buy buy!"
I don't think that is likely, but if they do I think they're going to have a hard time spinning next Friday's payroll numbers!
I actually think that MSM are perfectly capable of transforming whatever nonsensical fact, be it bearish or downright shit, into a glimpse of sunny bullishness. I specifically recall an instance from a few days ago when every single piece of news coming out was worse than the previous one, and I mean from a substabtial Chinese economy contraction to completely awful US economic indicators. Yet when the DOW initiated its full retard sequence, I actually heard Bloomberg's Matt Miller saying that the only "reasonable" explanation is that due to the storm of negative economic news, "investors" are taking their positions because it was more likely for Bernanke to announce QE3. (o_o)
Oh come on... that'll be Great For Inflation, the Fed won't have to tighten and stocks'll rally.
Get With The fucking Program!
I think that numbers are being managed to make grounds for QE3 if not now atleast in sept.
Charts on MS, GS and BAC are in severe downtrend. No amount of data can alleiviate the pain and we will see QE3 if not now next month.
charts:
http://capital3x.com/?p=278
Conspiracy or lies?
Which is worse?
They rounded up. Doesn't even matter what number they rounded up from... they were always going to round up to +1%.
We will see some growth starting next week, predominately in the debris hauling, and constructing industries.
Gotta love that HAARP.
It's also good with Guinness
Don't laugh.... try and find a flashlight in Westchester....
No, Irene is not that bad and will not do much. Gonna evaporate as soon as it hits the cape. The drought conditions in the Southest, just like in Texas are very bad and there is plenty of room on land in the vegetation to suck all the moisture out of this hurricane in a second. This is a GOOD thing, several of my crops need the water desperately. BRING IT.
Up here in Westchester, we have had a historically wet August. The ground is completely saturated... There will be some serious flooding with 4-8"....
Mark my words, Irene won't make it that far. Send your water south. Several crates of Pecans in it for you if you can make it happen.
I'm sorry, don't mean to be a tidge forward, but I can't resist. Did you do a shitload of drugs as a child? Did you ever stop?
I hope you are correct.... but I try to follow the maxim that an ounce of prevention is worth a pound of cure...
I was in Halifax the week after Juan hit in 2003. Juan was a fast moving modest cat 1-2 that made a direct hit on the city. The city was devastated, partially because it had been ~100 years since a hurricane had landed in the area. Trees everywhere. Westchester is similar, lots of old dodgy trees waiting for a big gust.
I would gladly send you the water, some golf courses here are soaked and almost unplayable...
the ground will suck it up? so you are saying a hurricane is not bad if it doesn't flood you out?
you might know laws of physics but lack those of common sense. i'm as cynical as the most about weather panic, but this thing is 90% to show up centered on new york city in 2 days, and 95% to hit the northeast generally.
First of all, fuck new york city.
Second, remember that hurricance (with actually MORE moisture than Irene) that hit Texas.
What happened? Poof! Gone.
"95% to hit the northeast generally. " - So NOW you are saying that weathermen are suddenly correct in all their predictions.
Talk about a LACK of common sense.
Bullish demolition. Construction, not so much.
The spread between the GDP deflator and the real inflation rate at least 5%, so in reality the economy continues to shrink by at least 4%. Depression since 2007.
Indeed. Way to cut through the bullshit. Prestidigiflation FTMFW!
BEA's calculation is a joke!!!! The whole owner occupied rent concept is ridiculous. How do they look people in the eye and say "there's no inflation" when people are standing in a freakin' store.
Funny, but the Wiemar Republic did exactly the same thing. As crap was spiraling out of control their current day ministry of truth was publishing statistics that everything was fine.
Sig Heil Bitchez!
Also, Private investment is only up "officially" 0.15%. That's were recoveries come from, capital investment. What would Murray make of all this insanity if he was alive today, especially with all the internet access? He could see through the all the bull way back. Even wrote an amazing critique of the Chicago School, monetarism and Friedman way back in 1971 before it influenced policy makers.
Which Murray? Bill? Rothbard? To which critique are you referring, as I am interested in reading such.
THX
The Zen Master Rothbard
http://www.lewrockwell.com/rothbard/rothbard43.html
Bill of course. The dissertation was post his 1971 arrest when he was advocating a move to the Cannabis Standard. Sadly, after the confiscation of said herb, his theories were discredited by a sea of voices from the fiat crowd. He fled the field of economics for greener pastures in entertainment to the regret of canna-numismaticists around the world.
The corporate profit numbers were revised down 5% from prior and now stand at 0% year-over-year...would one expect this, in combination with GDP, to move markets sginificantly lower independent of Bernanke's speech?
Oh fuck yeah! Let's put a 70X multiple on that shit and stocks'll make that 100,000 DJIA projection in no time.
What is the GDP number after REAL INFLATION? Great job Obama, you are carrying out the Saul Alinsky plan to a tee. Time now for amnesty to push what is left of this economy over the hill.
"What is the GDP number after REAL INFLATION?"
I make it at about -15%, but I've always been hopelessly optimistic.
Better then expected. Remove military spending and conumser spending and you get how much?
The most important figure, cap investment, is zilch.
Forget all the fundamentals and analysis. All you need to know is that I just hit the send key on my buy order and it's already down $.50. When I buy, it's time to sell.
Depends what you're buying.
thats funny. suggest wait for the Bernanke speech which may include QE3 or atleast a mention
The sequel to the Summer of Recovery is sooooo much better than the first one.
Another summer, another sputter... Maybe next time.
To be re-revised to 0.8 %, 0.3%, -1.2 % Blah, blah blah. Go be productive people.
Growth shrinking, inflation rising. Hello Stagflation... Nice to see you... It's been a long time...
You know that Paulie Krugnuts has to be quietly hoping that praying that Irene does enough damage that it can somehow unleash that much hypothesized, but never seen, "multiplier effect" in Fed.Gov stimulus spending. Because hurricanes can be very bullish, you know.
If this were stagflation like in the 1970's you'd still have 5% GDP growth. THis is something different. When the next revision comes in it will become clear that real growth is negative. Also during the 1970s you did not have such sustained and high levels of unemployment. Again, it's a different animal
Excellent points. This is shaping-up to be not only different, but much, much worse.
So much so that we might be looking back longingly at the Carter Years (but not, I hope, The Disco Crisis) before too long.
Well at least we got Three's Company, CHiP's, and The Jefferson's out of the Carter years. It wasn't a total waste.
And we get "Movin' on up to the West Wing"
Just say no 'cause some shit's never safe
The more things change . . .
http://www.youtube.com/watch?v=QkEiplH59uk&feature=related
Ugh. Now I have to reach for the lye soap and wire brush.
Thanks a ton.
I agree. Those will be the good ole days. At least incomes were rising
Ladies and gentlemen....Mr. Conway Twitty.
someone has to compile a good list of all the politicians and fed and treasury secretary's comments saying how all is good
Ive seen that chart of various statements about how great things are, the worst is behind us, the futures so bright we gotta wear shades...before and during the great depression plunge.
And as I've predicted, the Fed is boxed in to a perfect Biflationary trap: GDP sinking, core PCE rising (now above it's 2% target). Beautiful. You can thank QE and other reckless monetarist delusions.
So what is the FED going to do about it?
GDP...what is it really made of anymore except ZIRP free money printing 'product'?
There's unlimited upside potential in hat production. The pictures of the last depression showed a sea of hats in the breadlines. Everybody had a hat.
Go long hats.
The problem with the problem is ... we are given soultions in the form of either/or -- QE3 or not. Door number 3 please Vanna.
We need to get creative with door number 3
I'm afraid that any solution will call for new management in Washington and on Wall Street.
<---Replace Wall Street (Senior Management) and Washington (Middle Management
<---Replace their owners (The Board)
The fish rots from the head first. Capital and the Capitol answer to neither you our I.
Its not the way it has to be.
+ArkAng
Obama has one thing to be grateful for. That we do not have a parlimentary form of govt. Had we, he could not survive the no-confidence vote. He is the biggest drag on our economy.
And Potus is going to teleprompt at 11:30am (hurricane).
Maybe we can hit the Bernake put strike price (950-1000 S&P) today?
and it will be an effing cat 1 or less by the time it hits (what are the odds he takes a Libya victory lap during his remarks) and narcissist that he is, comments on how he too will be in harms way in the Vineyard
I'm listening to Kotok on Bloomberg (what a knob)
He's spouting the same crap as the NYT
Reduce the underwater "homeowners" by allowing them to refinance with no discussion of who pays.
Kotok fully invested and blames the GDP 100% on the Japan quake, he sees 3% GDP in h2.
He also pronounces Hurricane as Hairiane and worships at the alter of the Buffett.
(didn't ZH used to publish stuff from Kotok?)
They indeed are planning a massive underwater homeowner refi package that was announced at the same time Buffett bought his shares of BAC. Cute.
So in other words another 12 months free rent for millions of mortgage squatters?
Yep.
And that's, of course, bullish.
has anyone written something on the implications of such a program as in who pays, who wins, who loses etc.
I posted in the other thread how the canning of Schneiderman is likely a quid pro quo for the banksters with Buffy as the frontman
The O-Team is working hard to keep the debt slaves shackled to their houses. The problem is most of the folks who really need help have stopped paying their mortgage and are living rent-free, and many of those are unemployed. A lower mortgage payment accomplishes nothing.
Except, as you say, keeps debt slaves shackled to their houses.
Even if they get another shot at actually following rudimentary property law, don't be so sure they'll actually get it right... the biggest problem is that the paperwork requires attention to detail, some training, and some common sense... and the people performing the work are void of the requirements. They simply don't have the money to ensure all of these items are done correctly... if MERS was created to save nickels and dimes on the transactions, how the shit are they going to pay attorneys to clean up EACH one?
The refi option is simply there to avoid legal fees and give the issuer some refi charges, while arguably clearing up the previous chain of assignment... it's simply the best option for the banks... for whatever reason, they think indigents are going to go along with this crap...
They might and I mean might get some nibbles for significant principal reductions... but other than that I can't see any material number of people jumping at the chance... (and why would anyone in a nonrecourse state even think about doing anything other than living there rent free and turning the keys in if pushed?). Seems pretty desperate... but, they haven't quite figured out that when people have no alternative, they can't play the game anymore... while I might have made many bad purchasing decisions before, I have no options at this juncture and have been slapped in the face with reality (realty) in the meantime. Once bitten, twice shy. And, practically speaking, it's pretty tough to make a fruitful offer when your competition is offering payments of $0/mo.
As usual, credit worthy borrowers are flipping the bird. I just don't see who this could possibly be directed towards other than creditors...
With these numbers, it's unlikely Bernank will do much on the monetary side today except "monitor the situation and intervene as needed".
What they're going to do is roll out a gaggle of new fiscal stimulus programs: a housing/mortgage package, a jobs bill, and an infrastructure bill.
Bernanke could intervene in 15 minutes, whats the rush? After all, the masochists are not through with us yet.
Hurricanes are off balance sheet expenditures.....and no politician will vote against aid in a hurricane...I think the Pols will start spending early next year to buck it up for the elections...3-4 months of gains will show the voters all things are good...wink..wink...vote for me....
Clearly the downward revision in GDP was because of the anticipation of the hurricane. And earthquake.
QEasy money done wonders for the economy hasn't it... and they want more?
Another 'within the margin of error rounding' data point....hell these people can say what they want. Does anyone really assume any of these numbers have any honesty in them at all?
If it served their purpose, they could have come out and said 'GDP up +5%' and what would anyone do about it? Nothing, thats what.
I imagine Krugmann is hoping for alot of death and destruction right now to stimulate the economy and create jobs. Morbid jerk!
I dont know, people talk a lot about Krugman and these other jabberjaws, I dont have time to waste listening to any of these bullshitters. And when you dont listen to them, you realize you havent missed anything.
Negative real growth (contraction) AND rising input costs.
That's Biflation, baby!
Lotsa Luck, Mr Bernank.
Lotsa Luck, Mr and Ms consumer.
new trades for today:
http://capital3x.com/?p=289
Short S&P left right and center. trades with analysis.
Interesting. How does an economy go into recession with real interest rates below zero. " the circle jerk of fiat" has to stop here as lending by the banks to stimulate the economy will endure massive losses as the the FED backstops the banks with zero percent loans and the banks lend into the economy at less than zero rates. Rat eating its own tail to survive a few more days.
So by Sept.29 we should be in a fullblown recession?
Good thing the mighty Barama created a hurricane. Rather than a dismal economy, NBC (official state controlled media) can focus on the damn Irene. Already mouth foaming, the keynesian's dream of the gazillions in infrastructure spending (grift) they can impose.
http://www.youtube.com/watch?v=zDAmPIq29ro
Yes the government is indeed planning another massive housing plan to help homeowners refinance their homes, in which they currently have no equity, to take advantage of low rates. These people will then refinance, take out some equity (CA-CHING!) and will be able to buy more iCrap and more Hot Pockets so they can comfortably watch their reality shows and ramp it up for the holiday season. I mean, its a no-brainer that people people earning $30K a year should have several flat-screen TVs no?
It's a win-win for the economy going forward...
And the end of the dolar. Gold to the moon. But then again, specialized economies do what they do best and Americans know how to buy crap, so be it. Good luck sustaining that.
Well, it's only going to get worse from here. Irene has been renamed to hurrican George W. Bush. When Bush hits the coast and does dammage it will get blamed for the next "miss".
Heard on Bloomberg that no way the Bernank "front-run" the President by putting forth ANY plan that will help the economic situation. So the geniuses at the central bank have to volley the imminently exploding hot-potato to Barack Obama, organizer-in-chief.
God help us all...
I'm shocked to see that somehow, magically, it didn't print under 1.0%.
what up with the ben bernanke nazi salute on bloomberg ?
http://www.bloomberg.com/
The print prices in projected decline from bad weather on the east coast. It is prospectively pessimistic and provides for a high-chance of surprise to the upside for next quarter.
/closes spin doctor app on iphone
//browses for porn
Well atleast the Central Banks can get us out of this mess, unless that Greek thing doesn't work out , or Ireland or , wait is this really working???
Subtract 2.5% for government spending from the 1.0% print and you get the real organic, private sector GDP number.
-1.5%
Recession bitchez !