Today's Q4 GDP revision was far below expectations. Originally reported at 3.17%, real GDP for the fourth quarter was revised down to 2.79% growth. Government, once a form of stimulus for economic growth has now become a drag at (.20%) of GDP. The consumer, thought to be strong came in weaker and was revised down as well by .16% although still contributing to growth.
Below is a summary of the original GDP versus the revisions. Overall, for an economy two years out of recession having experienced trillions in stimulus, this is not a good report. The data reported by BEA is real GDP and to convert from nominal to real the BEA uses two different inflation measures. They use a less aggressive number on the overall report yet on the import component which per the formula is a drag on GDP a more aggressive number. This questionable number many would argue easily overstates real GDP and in fact growth is far lower than reported.
Below is a summary of the original GDP versus the revisions. Overall, for an economy two years out of recession having experienced trillions in stimulus, this is not a good report. The data reported by BEA is real GDP and to convert from nominal to real the BEA uses two different inflation measures. They use a less aggressive number on the overall report yet on the import component which per the formula is a drag on GDP a more aggressive number. This questionable number many would argue easily overstates real GDP and in fact growth is far lower than reported.
It was priced in anyway by the all seeing market.....
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