We all know the government’s first reported economic number is manipulated to its best result in order for Wall Street shysters to levitate the stock market with their HFT supercomputers. Then subsequent revisions downward are downplayed and ignored. It’s the American way. This figure will be revised into negative territory over the next few months.
The pitiful reported 0.1% GDP number is a joke. The BEA bozos actually expect you to believe that inflation was only 1.4% over the last year. Their manipulated bullshit figure is even lower than the CPI lie put out by the BLS drones. Inflation is running north of 5%. REAL GDP is in the NEGATIVE 4% to 5% range.
The propaganda peddlers on CNBC are ecstatic about the 3.1% gain in consumer spending. WOO HOO!!!!
It seems the dramatic surge in consumer spending was to pay for the massive increases in health insurance premiums due to Obamacare, the sky high heating bills from the frigid winter, and the 13% increase in gasoline prices. Oh I forgot. The BLS tells us that gasoline prices were falling in the 1st quarter.
How can the talking heads blame the cold winter for the terrible GDP when consumer spending accounts for 71% of GDP and it surged due to the cold weather? Hmm.
So we have an “economic recovery” driven by people forced to spend more for healthcare, energy and food while receiving 0% return on their savings, seeing their real wages decline, and being taxed more by local, state and federal governments. At least there are still those gigantic potholes on every road in my state.
This report was an absolute disaster and PROVES we are in recession. Wall Street will be ecstatic and will levitate to new highs. If Obama can just get World War III started in the 2nd quarter, GDP will soar and economic recovery will have arrived.
GDP Shocker: US Economic Growth Crashes To Just 0.1% In Q1
Submitted by Tyler Durden on 04/30/2014 08:38 -0400
Despite consensus at 1.2% growth QoQ, the “weather” destroyed the fragile stimulus-led economy of the US which managed only a de minimus +0.1% QoQ growth (the lowest since Q1 2011). However, as Steve Liesman noted on the heels of Mark Zandi’s comments “basically ignore this number” – ok then. Spending on Services, however, surged by the most since 2000 – heralded as great news by some talking heads – but is merely a reflection of the surge in healthcare and heating costs (imagine if it had not been cold and if Obamacare hadn’t saved us). As a reminder – this is the growth that is occurring as QE has run its course, as stimulus ends, and as escape velocity nears… if the “weather” can do this much damage to the US economy, should stocks really be trading at the multiple of exuberant future hope that they are?
The full breakdown of GDP components:
If It Wasn’t For Obamacare, Q1 GDP Would Be Negative
Submitted by Tyler Durden on 04/30/2014 09:13 -0400
Here is a shocker: for all the damnation Obamacare, which according to poll after poll is loathed by a majority of the US population, has gotten if it wasn’t for the (government-mandated) spending surge resulting from Obamacare, which resulted in the biggest jump in Healthcare Services spending in the past quarter in history and added 1.1% to GDP …
… real Q1 GDP (in chained 2009 dollars), which rose only $4.3 billion sequentially to $15,947 billion, would have been a negative 1.0%!
It’s curious how the weather impacted (or rather is used as an excuse to explain) everything but government-mandated healthcare spending in the first quarter.
And of course, for all those who correctly point out that mandatory spending on healthcare, also known as malinvestment, took away from spending on every other discretionary item possible, well… you are right.
About That CapEx Spending Renaissance…
Submitted by Tyler Durden on 04/30/2014 09:28 -0400