Revised GDP: -1.0%
The Bureau of Economic Analysis released its first revision (the “preliminary” report) of Q2 GDP.
Consensus is that the original print (“advance” report) of minus 1% will be revised downwards to -1.5% quarter/quarter, as we get updates on Personal consumption, gross private investment, government consumption, and the difference between exports and imports, mostly to the downside. (The green shoots crowd is looking for a greater than expected inventory reduction)
I am looking for a revised -2%.
I will update this when GDP hits. Updated:
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 1.0 percent in the second quarter of 2009, (that is, from the first quarter to the second quarter), according to the “second” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP decreased 6.4 percent.
The GDP estimate released today is based on more complete source data than were available for the “advance” estimate issued last month. In the advance estimate, the decrease in real GDP was also 1.0 percent.
The decrease in real GDP in the second quarter primarily reflected negative contributions from private inventory investment, nonresidential fixed investment, personal consumption expenditures (PCE), residential fixed investment, and exports that were partly offset by positive contributions from federal government spending and state and local government spending. Imports, which are a subtraction in the calculation of GDP, decreased.”
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August 27th, 2009 at 8:41 am
Wasn’t the consensus -1.5%???
On hearing 1.0, the S&P futures spiked mildly (but then pulled right back)…
We’ll see what happens during the day, but I would consider it very bearish if the S&P can’t rally on what would appear to be better than expected news…
I’m looking at this very quickly because I’m on my way out the door so maybe I’m missing something…
My bottom line is that the S&P is close to some very important technical levels just above where it sits…It would need no more than a 2 or so percent rally to achieve those levels, so you’d think something like this could be the spark…
We shall see…
August 27th, 2009 at 8:42 am
shoulda said -1.0%…Sorry
I gotta go…
August 27th, 2009 at 8:47 am
over/under on initial claims getting revised back to 575 next week?
August 27th, 2009 at 8:54 am
Thank god more bad news is covered by a “better than expected” headline!
August 27th, 2009 at 8:55 am
The only “silver lining” to our huge trade imbalances is that we can off load part of our economic contraction to the rest of the world. Take away the 1.4% benefit in trade and we would have been down 2.4% this quarter.
The same holds true with unemployment. Many of our “guest workers” have returned to their native countries now that construction and services jobs are going away.
August 27th, 2009 at 8:55 am
The really good news is that Mother Theresa is no deader today than she was yesterday, which, of course, means she’s doing better than expected.
August 27th, 2009 at 8:55 am
let’s see if Kass will be correct on his top call w/ this better than expected number
also thought this was interesting- Fed looking for a stay of the court order requiring disclosure of banks that are on the fed’s lifeline through its various lending facilities- from NC-
“Quelle Surprise! Fed Uses Scare Tactics to Try to Forestall Loan Disclosures”
“In a show of how much our government thinks that serving the financial oligarchy, rather than the citizenry, is its prime duty, the Fed is fighting to stop the court-ordered disclosure of who borrowed money under the Fed’s various lending facilities. . .
[reasons given]
“The institutions whose names and information would be disclosed will also suffer irreparable harm. . .
[the]“ability to effectively manage the current, and any future, financial crisis” would be impaired. . .
. . . significant harms” could befall the U.S. economy….
. . . disclosure might set off a run by depositors and unsettle shareholders….”
there we have it- secrecy at all costs- even more reason why the light of day needs to shine on the Fed and it’s high risk strategies to save the TBTF banks
August 27th, 2009 at 9:04 am
@ call me ahab
Specifically just what is the Federal Reserve keeping hidden from its citizenry? Does anybody have a good professional guess?
If certain banks are in such an irreparable state, then shouldn’t they be allowed to fail? It is not as if the Fed hasn’t had enough time to orchestrate an appropriate and orderly wind down.
btw, not likely, but if Goldman Sachs is one of the bailed out banks, I’m moving to Canada.
August 27th, 2009 at 9:10 am
bsneath-
i hear you dude
also- to follow on cv’s post- if the markets can no longer rally on BTE news than something is amiss in the wonderland that is the current trading mentality
August 27th, 2009 at 9:24 am
It’s in our best interest not to know whats going on, thats reassuring.
August 27th, 2009 at 9:27 am
It’s kind of like taking a 3rd world bus trip, you learn to not watch whats happening in front of the bus.
August 27th, 2009 at 10:22 am
jc at 9:27 am
“It’s kind of like taking a 3rd world bus trip, you learn to not watch whats happening in front of the bus.”
nor should you look at the bus carcasses littering the canyon bottom as the bus barrels along the edge of the precipice, rounding the blind hairpin turns…
August 27th, 2009 at 10:30 am
Speaking of carcasses, I took a trip from Florida to North Carolina a couple weeks back. There were nearly a dozen abandoned, red tagged autos on the highways. Normally you see an occasional one, but not this many. it is as though the cars broke down, no cash to tow and repair, so walk away?
August 27th, 2009 at 10:51 am
This GDP is still an estimate, no? There is time to revise it still. BR you’ll probably be proven more right than wrong by the time the final number is released.
August 27th, 2009 at 2:20 pm
Barry, with the comprehensive revision, BEA has dropped the “Advance,” “Preliminary,” and “Final” nomenclature for the vintages of their GDP releases. They now go “Advance,” “Second,” and “Third.” So, today’s release was the “second” gdp release, not the “preliminary.”
August 27th, 2009 at 5:18 pm
-1%, -1.5% or -2%, the bigger news is that is was the 4th consecutive quarter which contracted. Welcome to the 2nd Depression in 80 years. Proving once again that our government is the best, money can buy.