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First Quarter GDP Revised Down To 1.8%

Bronson

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First Quarter GDP Revised Down To 1.8%: Bernanke's Taper Talk Came Too Soon - Forbes

In a world that has been turned on its head, where bad news is good news as it means more monetary support from the Fed, substantial weakness in the U.S. economy was met by optimism on Wall Street. While the U.S. economy was supposed to be the bright star, outperforming its ailing peers, the third and final revision to first quarter GDP showed a meager 1.8% expansion in output, down dramatically from 2.4% previously. Investors rejoiced as the data suggests it will be highly unlikely for FOMC’s full-year GDP projection to be met, meaning QE tapering could be delayed further.
1.8% is pathetic
 

Kushinator

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1.8% is pathetic
It is undeniably sub-par. Look for economic growth to shrug off tax increases and the sequester in the coming quarters. The Fed isn't talking taper for the fun of it.
 

washunut

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It is undeniably sub-par. Look for economic growth to shrug off tax increases and the sequester in the coming quarters. The Fed isn't talking taper for the fun of it.
Fed is between a rock and a hard spot. QE3 has not given the economy the bump they hoped. My sense is that they can't grow the balance sheet indefinitely so they have to start tapering.
 

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Fed is between a rock and a hard spot. QE3 has not given the economy the bump they hoped. My sense is that they can't grow the balance sheet indefinitely so they have to start tapering.
Well, credit easing cannot create jobs when banks continue to hold off on lending:



There are more creative ways to stimulate lending. They can begin purchasing prime commercial loans. When the fiscal side does not want to react, the Fed must.
 

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1.8% is pathetic
Simple question, why did you get upset when previous quarters were adjusted to higher rates (calling it a farce) but accept the lower rate as God's truth?

Furthermore, I take it you are upset at Congress? After all, Congress writes laws and spends money. The Executive Branch does neither.

Also, do you believe stopping QE will increase economic activity, is so how?
 

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See how con ‘editorials’ just cant push their agenda in an honest and intelligent fashion. Some day I will read an honest and intelligent con editorial but that day hasn’t come.

Lack of integrity :“,outperforming its ailing peers,”
We are out performing our ailing peers. While our ailing peers struggle to stay out of recession (triple dip recession in some cases) because of their failed austerity policies, President Obama has reduced the deficit every year as a % of GDP, cut Bush’s deficit in half and done so while maintaining positive GDP.

More lack of integrity:“While the U.S. economy was supposed to be the bright star”
Bright star? Nobody is calling our economy a bright star. See how the ‘editorial’ has to attack an imaginary narrative.

Lack of intelligence:“the third and final revision to first quarter GDP showed a meager 1.8%”
Third and final? I’m not aware of a cutoff date for GDP estimates. Q4 2008 GDP final revision came out 2 years after the fact.

1.8% is pathetic
And it seems a weak economy is a reason for investors and conservatives to rejoice. But how exactly do cons not hold republicans and their policy of obstructionism accountable for any of the lack luster growth? Lack of intelligence or lack of integrity?
 

washunut

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Well, credit easing cannot create jobs when banks continue to hold off on lending:



There are more creative ways to stimulate lending. They can begin purchasing prime commercial loans. When the fiscal side does not want to react, the Fed must.
My sense is that you confuse lending that makes sense in this economic/regulatory environment with lack of lending. You also confuse lending to people who can actually afford to pay their loans to loaning to anyone. Car sales are up to nearly 15 million, you think those are all cash sales? Home sales and prices are up.
 

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Lack of integrity :“,outperforming its ailing peers,”
We are out performing our ailing peers. While our ailing peers struggle to stay out of recession (triple dip recession in some cases) because of their failed austerity policies, President Obama has reduced the deficit every year as a % of GDP, cut Bush’s deficit in half and done so while maintaining positive GDP.
Give it a rest, the reason our peers are ailing is because they all followed the same failed Keynesian economics, the only deficit Obama has reduced is his own record spending deficit which was 3x the Bush Average. Do let us know when Obama gets the deficit down below even that of Bush (minus the last year, which is for reasons of your propaganda the only year of 8 you want to recognize). What is happening is quite clear to all of us with our heads not up our ... The Fed is tapering because they are out of other people's money and the reality that austerity is a result of deficit spending not a choice, is finally hitting home.
 

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First-quarter GDP rose at a 1.8% annual rate, the Commerce Department said Wednesday, not the 2.4% it previously estimated. Downward revisions to consumer spending were the main driver.

That comes after Q4's 0.4% growth, which means the economy has been at a virtual standstill for six months.

And while Obama's four-year old recovery continues its long slog, the job market grows increasingly grim. While the official unemployment rate has fallen to 7.6%, that's largely because millions of Americans dropped out of the workforce. Had that not happened, the jobless rate would be over 10% today.

Meanwhile, there are still 2.4 million fewer jobs today than there were before the recession hit. The number of long-term unemployed is higher than it was when the recovery officially started in June 2009. The jobless rate is 13.5% for blacks and 9.1% for Hispanics.

Read More At Investor's Business Daily: Shoddy Economy Exposes Obama's Upside-Down Priorities In 2013 - Investors.com
Follow us: @IBDinvestors on Twitter | InvestorsBusinessDaily on Facebook
 

Kushinator

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My sense is that you confuse lending that makes sense in this economic/regulatory environment with lack of lending. You also confuse lending to people who can actually afford to pay their loans to loaning to anyone. Car sales are up to nearly 15 million, you think those are all cash sales? Home sales and prices are up.
Lending to small business is still at depressed levels. Hence, you are confused about what types of lending will provide needed job growth.
 

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Any growth is good, this just isnt good enough to keep up with population growth and recovery from the recession. There are plenty of things congress could be doing to encourage growth, but instead its wasting time on amnesty, guns, etc. anything but fiscal discipline and regulatory reform.
 

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Any growth is good, this just isnt good enough to keep up with population growth and recovery from the recession. There are plenty of things congress could be doing to encourage growth, but instead its wasting time on amnesty, guns, etc. anything but fiscal discipline and regulatory reform.
The reason for that is government is in the business of creating more government, the more they spend the more power and control they have over the dependency they create. Amnesty, guns, etc expands their role and dependency voter base fiscal discipline and regulatory reform does just the opposite.
 

Bronson

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Simple question, why did you get upset when previous quarters were adjusted to higher rates (calling it a farce) but accept the lower rate as God's truth?

Furthermore, I take it you are upset at Congress? After all, Congress writes laws and spends money. The Executive Branch does neither.

Also, do you believe stopping QE will increase economic activity, is so how?


Older graph but pay close attention to the projection with and without the Stimulus
 

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Older graph but pay close attention to the projection with and without the Stimulus
Without a doubt, they underestimated the severity of the crisis.
 

Bronson

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Without a doubt, they underestimated the severity of the crisis.
So not only were they incompetent, but the policies they put into place to try and alleviate the situation only made things worse. (Trillions more in debt)
 

Kushinator

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So not only were they incompetent.
Nobody new that household wealth losses would approach 100% of GDP.

but the policies they put into place to try and alleviate the situation only made things worse. (Trillions more in debt)
You will be hard pressed to make a valid case that things are worse than what they were in the dark days of 2008 and 2009.
 

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You will be hard pressed to make a valid case that things are worse than what they were in the dark days of 2008 and 2009.
Unless you take into account the false bottom we are standing on.
 

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Nobody new that household wealth losses would approach 100% of GDP.



You will be hard pressed to make a valid case that things are worse than what they were in the dark days of 2008 and 2009.
Actually, IMO, things are fundamentally FAR worse now...and as soon as the Fed runs out of QE's OR they stop propping up the economy...everyone will see just how much worse.
 

Bronson

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Nobody new that household wealth losses would approach 100% of GDP.
So the answer was Obamacare and skyrocketing food stamp rolls? Come on man stop playing games.

You will be hard pressed to make a valid case that things are worse than what they were in the dark days of 2008 and 2009.
Trillions more in debt is worse. It's an easy case to make.
 

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Without a doubt, they underestimated the severity of the crisis.
Yes, the devastation of the Great Bush Recession was vastly underestimated. Bush’s economic destruction was unprecedented. He destroyed 2 sectors of the economy, construction and financial. They had no other recession to compare it to. (watch how I prove my point. something cons cant do)

Here’s the BLS’s first estimate

"Real gross domestic product -- the output of goods and services produced by labor and property
located in the United States -- decreased at an annual rate of 3.8 percent in the fourth quarter of 2008"

BEA: News Release: Gross Domestic Product

Here’s their updated estimate

"Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- decreased at an annual rate of 6.3 percent in the fourth quarter of 2008,"

http://www.bea.gov/newsreleases/national/gdp/2009/pdf/gdp408f.pdf

And possibly their final estimate

“and the latest estimate shows a decrease of 8.9 percent.”

Why has the initial estimate of real GDP for the fourth quarter of 2008 been revised down so much?


but the policies they put into place to try and alleviate the situation only made things worse. (Trillions more in debt)
Well file this under a "lack of intelligence". His radio masters have convinced him the economy should only be judged by "trillions more in debt", not GDP, not UE, not declining deficits, just "trillions more in debt". Of course the con metric of choice changes from thread to thread.
 

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Actually, IMO, things are fundamentally FAR worse now...and as soon as the Fed runs out of QE's OR they stop propping up the economy...everyone will see just how much worse.
Opinions vary.
 

Kushinator

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So the answer was Obamacare and skyrocketing food stamp rolls? Come on man stop playing games.
No, it was to provide enough liquidity to avoid the liquidationist mentality to take hold and to provide stimulus.

Trillions more in debt is worse. It's an easy case to make.
Trillions in more debt is the natural result of going into a severe recession. The economy is much better than it was during the dark days of 2008 and 2009. Public debt is not the be all/end all determination of a better economy.
 

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Yup - just as they did in 2007.

The Fed thought everything was more or less okay - the Fed minutes prove that.

And the masses and economist after economist thought things were great...then the bleep hit the fan.

Meanwhile, I had liquidated my entire portfolio in August '07 to invest in precious metals.

I am not bragging - I am merely showing how most people had no idea what was coming in '07 (to be fair, I did not think the downturn would be quite as bad as it was).

Yet, many saw it as inevitable years before.


When people fall in love with debt - bad things ALWAYS happen.

2007 was one of those times.

Today is another one.

The solution to too much debt is NEVER more debt.
 
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