Minutes
ago, the government released it's latest GDP calculation, which came in
at a decent 2.8%. It's not robust, but sufficient to get by and kick the can.
But there's a
problem. Beginning in August, they changed the calculation methodology.
They now add in a nebulous figure for what they are calling
"intangibles". INTANGIBLES???? In other words, an amount that can't be
calculated or measured. After all, they are "intangible". The word
IDIOCIES would be a better word! Idiocies for the economic ignoramuses!
Those
"intangibles" caused 2Q GDP to jump from 1.7% to 2.5%, about a 50%
increase. Thus, this new figure is probably much closer to 1.85% than
the figure that will be publicized in the new media. That is nothing to
crow about!
Update #1:
And consumer spending, called PCE (personal consumption expenditure),
which constitutes 2/3 of the US economy, was the lowest since 2Q 2011.
So the most important element of the US GDP calculation was the lowest
in more than 2 1/2 YEARS!
Something is ROTTEN in that apple!
Update #2:
Following this announcement and the ECB rate cut news, stocks have now dropped back to flat.
Wall St must be viewing this GDP figure as the good news that will dampen Fed enthusiasm for money printing. They needn't worry! It won't!
PCE was just a paltry 1.04%! Does that sound like robust consumer spending to you? Yeah, me neither!
