The final revision to Q1 GDP changed very little, at least in its natural format given that there are benchmark revisions coming in less than a month that could significantly alter all of this. Even with “residual seasonality” there is every reason to suspect that the economy is weak even as compared only to the past few years. That seems [...]
When commenting on any weakness in the US economy, it has become common even shorthand for any outlet or author to affix the conventional explanation. Suspiciously low growth rates and far too many outright contractions, especially in manufacturing and industry, are blamed on overseas weakness and the dollar as if absent that foreign interference all would be sailing along right [...]
Economists continue to claim that manufacturing just doesn’t matter and that the service economy is more than fine. Setting aside the obvious link between services and goods to begin with (since so many services are dedicated to managing, moving and especially selling goods), it just doesn’t add up; if consumers are freely spending on services then why would they so [...]
You get the same sense from factory orders that you get from payrolls – the economy is obviously and significantly slowing but there isn’t yet any crispness or urgency to any of it. I think that is the business environment reacting to both revenue reality (falling off) without being ready to commit to more serious negative adjustments just yet. In [...]
The ISM for August was the lowest reading since the taper drama of 2013. At just 51.1, there isn’t any real basis for suggesting the manufacturing sector is even expanding (no matter what these sentiment surveys claim about that 50 dividing line). The “correct” interpretation is one which discards the exact figure for the relativism. For once, media commentary was [...]
Because of the way GDP is calculated currently, the latest release on the US trade deficit is going to boost GDP slightly for Q2 (and just as likely will get canceled by a downward revision somewhere else). The logic and methodology is sound, but that does not mean it is a perfect measure. The fact that imports declined so much [...]
On March 28, 1997, the Bureau of Economic Research downgraded economic growth estimates for the fourth quarter of 1996. Over the course of the two months between the advance estimate, preliminary estimate and final estimate, the BEA reduced GDP by a rather large 0.9%. The reduction in GDP then was similar in absolute size to the current revisions to Q1 [...]
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