Sometimes you just have to laugh at the gibberish dumped from the government propaganda agencies. Not only is the BEA overstating GDP by laughably telling us that inflation is only 1.6%, but they just adjusted GDP higher because we all spent more in the 4th quarter paying for healthcare than previously reported. Think about that for one minute. Obamacare forced you to pay higher health insurance premiums and the government considers that a BOOST to GDP.

WOW!!!! No wonder Obama is happy about Obamacare forcing insurance premiums up by 30% to 50%. It’s boosting our economy. What a fucking joke this country has become. And CNBC, along with the other media mouthpieces, will report this GDP increase as a positive for the American people.

Final Q4 2013 GDP Misses Expectations, Rises 2.6% Annualized – Full Breakdown

Tyler Durden's picture

And so the various estimates of Q4 GDP have made an almost full circle: starting at 3.22% in the first forecast, plunging to 2.38% in the second, and finally settling at 2.63%, a miss from the expected 2.7%. This is down from 4.1% recorded in Q3 which however as everyone knows by now was purely due to a unprecedented, record inventory build up.

In terms of components, Personal Consumption was the silver lining in this latest economic miss, rising at a 3.3% pace higher than the expected 2.7%. This was driven by greater than expected spending on health and financial services. Yes – higher health insUrance costs are somehow a boost to GDP. How this offsets spending on other end goods and services with a finite and declining disposable income stream remains to be seen.

In terms of the actual contribution, Personal Consumption was 2.22%, above 1.73% in the prior revision, offsetting yet another decline in the contribution from Capex, i.e. Fixed Investment, which dropped from +0.58% to +0.43%. By now, however, even Larry Fink has figured out that as long as the Fed is around, there can be no true CapEx growth. Which means it is all about boosting Personal Consumption through the “Russell 200,000” wealth effect channel.

The full breakdown of quarterly GDP is shown below.


But don’t worry: those hoping Q1 will be better, don’t hold your breath. This is what’s coming. You know – “snow in the winter” and all that.


  1. I said it here first. The new mandates constitute a hedonistic improvement.

    Remember, I also said Krugman is salivating at the prospect of all the deficit financing that will be required to keep the health insurance companies solvent.

  2. Not only are there no Statesmen in D.C. (and damned little in the State Legislatures) all common sense and honesty has been abandoned every level.

    I get vastly tired of the whole non-morality play.


  3. Considering how much debt is being created, and how much money is being printed every day, GDP should be 5% or more. Or, stated another way, without money printing and massive debt creation, GDP would be -2.6%.

    Paul “Contrafactual” Krugman: The Laureate of Keynesian Babble

    by David Stockman • March 27, 2014

    If you are not Professor Paul Krugman you probably agree that Washington has left no stone unturned on the Keynesian stimulus front since the crisis of September 2008. The Fed’s balance sheet started that month at $900 billion–a figure it had accumulated mostly in dribs and drabs over the course of its first 94 years. Bubbles Ben then generated the next $900 billion in 7 weeks of mad money printing designed to keep the tottering gambling halls of Wall Street afloat. And by the time the “taper” is over later this year (?) the Fed’s balance sheet will exceed $4.7 trillion.

    So $4 trillion in new central bank liabilities in six years. All conjured out of thin air. All monetary vaporware issued in exchange for treasury and GSE paper that had originally financed the consumption of real labor, material and capital resources.

    And if $4 trillion of monetary magic was not enough, the action on the fiscal front was no less fulsome. At the time in March 2008 that Goldman’s plenipotentiary in Washington, Secretary Hank Paulson, joined hands with the People’s Tribune from Pacific Heights, Speaker Nancy Pelosi, to revive Jimmy Carter’s infamous $50 per family tax rebate, hoping America’s flagging consumers would be induced to buy a flat-screen TV, dinner at Red Lobster or new pair of shoes, the public debt was $9 trillion. It will be $18 trillion by the time the current “un-ceiling” on the Federal debt completes its election year leave of absence next March.

    Yet $9 trillion of added national debt in six years is not the half of it. Even our Washington betters do not claim to have outlawed the business cycle, and we are now in month 57 of this expansion. Given that the average expansion during the ten “recovery” cycles since 1950 has been 53 months, it might be argued that we are already on borrowed time fiscally. That is, we have already used up the forward area on Uncle Sam’s balance sheet that is supposed to be available to absorb the predictable eruption of red ink that will occur during the next recession or financial bubble collapse or China melt-down etc.

    In fact, peering at the future through its Keynesian goggles, the CBO assumes that the US economy will accelerate to nearly 3.5 percent average GDP growth until it reaches “full employment” around 2017, and then will remain in that beneficent state for all remaining time, world without end! Yet even then it projects a cumulative deficit of nearly $10 trillion under “current policy” (i.e. bipartisan can-kicking of expiring tax and spending giveaways) over the next decade.


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