Perhaps the BEA should have moved the GDP release up a few days to allow mainstream commentary its unbridled and unstained euphoria. Almost as soon as the GDP revisions were released, the upward appearance of economic growth was seriously undermined by income results and the nature of spending “gains.” That was soon followed by a rather dire look into business [...]
I’m not sure what basis there is for expecting a robust holiday season. Even factoring the move in the unemployment rate and upward revisions to GDP in the past two quarters, none of that has done anything toward correlating with rising income. In fact, 2014 is conspicuous in that aspect more than at any time during this “recovery.” The latest [...]
Continuing on with the theme of orthodox interpretation vs. context, in order to determine not just the relative position of the economy but how that relates to “markets” vis-à-vis bubbles, the current estimates of personal income and spending fit well within those rough confines as I have described them. The orthodox interpretation sees the changing growth rates in 2014 as [...]
In anticipation of tomorrow’s jobs frenzy, with all attention fixed to a statistic that was never meant to convey meaning in the current predicament (the unemployment rate is not supposed to be driven by the denominator), a review of context is in order. That is particularly true as I have detailed recent indications of a foul and maladroit trajectory for [...]
The most important segments of the GDP report are, to me, final sales and gross private domestic investment (outside of inventory). Those are the proxies for end user demand in the economy (final sales to domestic purchasers), level of production (final sales of domestic product) and business tendency toward investment (or disinvestment). Overall GDP can grow at 3+% in the [...]
The NBER considers employment and incomes as the two primary indications of economic cycles. Contrary to conventional thought, a recession is never defined as two consecutive quarters of negative GDP. In issuing its November 2001 declaration for a cycle peak dated to March 2001, for example, the NBER said, “A recession is a significant decline in activity spread across the [...]
Since January, we are supposed to believe that the jobs market is recovering when the official labor force contracts by 168,000 persons? I cannot think of any economic reality where that incongruity can be resolved outside of a central planning paradise. What that means, strictly according to the numbers, is that the civilian non-institutional population rose by just shy of [...]
The best ISM Manufacturing PMI since the middle of 2011 seems to indicate better economic conditions in the middle of 2013, particularly when compared to the first few months. However, the ISM has been in the up and down pattern since the middle of last year, notably rising to 54.2 in February 2013 before collapsing again. The February number caused [...]
Labor unrest is an expected feature of a malfunctioning economy. The 1970’s, for example, were rife with labor problems up and down the economic scale and across industries. Agitation for wage growth was proportional and directly attributable to the public’s perceived ability to maintain some standard of living. The Great Inflation threatened to leave a good deal of the populace [...]
Consumer confidence is at multi-year highs while personal income and wage levels for April were declining on a nominal basis. Without the boost of 0.2% “deflation”, disposable personal income actually declined 0.1% on a nominal basis. Personal spending fell 0.2% on a nominal basis. The internals of the nominal decline related to three separate items – farm proprietor’s income fell [...]
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