Q3 GDP Slips Further to 2.2%
GDP’s 3rd revision came out this morn, and it was below consensus:
“Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 2.2% in the third quarter of 2009, (that is, from the second quarter to the third quarter), according to the “third” estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP decreased 0.7%.
The GDP estimate released today is based on more complete source data than were available for the “second” estimate issued last month. In the second estimate, the increase in real GDP was 2.8%.
The increase in real GDP in the third quarter primarily reflected positive contributions from personal consumption expenditures (PCE), exports, private inventory investment, federal government spending, and residential fixed investment that were partly offset by a negative contribution from nonresidential fixed investment. Imports, which are a subtraction in the calculation of GDP, increased.”
Futures softened a bit, but are still positive.
chart courtesy of Barron’s Econoday
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Source:
GROSS DOMESTIC PRODUCT: THIRD QUARTER 2009 (THIRD ESTIMATE)
(GDP) Q3 2009
http://www.bea.gov/newsreleases/national/gdp/gdpnewsrelease.htm
Previously:
Is the Recession Over ? Extended Transition Phase (October 29th, 2009)
http://www.ritholtz.com/blog/2009/10/is-the-recession-over-extended-transition-phase/
Big GDP Number: 3.5% (October 29th, 2009)
http://www.ritholtz.com/blog/2009/10/big-gdp-number-3-5/
December 22nd, 2009 at 9:21 am
But Green Shoots have to put roots down before they start to grow, don’t you know?
December 22nd, 2009 at 9:27 am
More recent data has been more positive :
-Labor Data Show Surge in Hiring of Temp Workers (NYT)
-Treasury Yield Curve Steepens to Record Amid Growth Outlook (Bloomberg)
December 22nd, 2009 at 9:41 am
That makes Q3 flat. Govt stimulus accounted for 2.2% of Q3, to my recollection.
December 22nd, 2009 at 9:43 am
Worlwide outlook
http://www.guardian.co.uk/business/interactive/2009/oct/27/recession-gdp
December 22nd, 2009 at 9:51 am
so Barry r you happy with these numbers?
December 22nd, 2009 at 10:08 am
yeah BR- there is a santa clause-
his name is Ben Bernanke-
and you can thanks him for supporting all asset prices- housing, equities, commodities-
if Fusion did well- then please send BB a Xmas card
December 22nd, 2009 at 10:16 am
Don’t forget to subtract out the debt that will be defaulted upon – it is growth that shows up as positive in the numbers but did not actually happen… and deficit spending by government that forces future inflation… and stimulus that merely pulls future demand forward, which requires a double entry on the ledgers.
We are still in recession.
December 22nd, 2009 at 10:27 am
VIX just dropped below 20. I’m calling complacency
December 22nd, 2009 at 10:30 am
how many traders at home have a big framed picture of Ben Bernanke near their trading desk?
December 22nd, 2009 at 10:46 am
It is all about the Fed, and cheap or free money. Boy this story is so familiar.
All the ‘pros’ know the Fed and or Treasury will not let the market fall too much.
December 22nd, 2009 at 10:53 am
Barry says: “More recent data has been more positive”
Of course, until it too gets revised lower or isn’t as strong as initially thought or whatever other nonsense is thrown in.
Look, it’s a rock and a hard place now. Dollar going higher on stronger home sales and more Euro fears. But now our GDP was revised down yet again suggesting growth isn’t so robust. What do you do now? Economy is obviously not strong enough to sustain with a strong dollar environment as it would in “healthier” times.
It’s definitely starting to get more interesting. Too bad the holidays are in the mix this week or the real fun would begin.
December 22nd, 2009 at 11:05 am
Fun with percentages!
Let’s see the GDP was revised downward from its original estimate. Ok, so they were off a bit. Well, maybe a more than a bit to the tune of 37%. Not bad.
Of course going forward, they’ll be much, much more accurate.