Skip to comments.Q2 GDP Surges 4%, Beats Estimates Driven By Inventories, Fixed Investment Spike.....
Posted on 07/30/2014 6:11:49 AM PDT by mykroar
Moments ago the Commerce department reported Q2 GDP which blew estimates out of the water, printing at 4.0%, above the declining 3.0% consensus, as a result of a surge in Inventories and Fixed Investment, both of which added over 2.5% of the total print, while exports added another 1.23% to the GDP number. The full breakdown by component is shown below.
What is interesting is that the Commerce Department announced that as a result of incomplete June data, the biggest components of the GDP beat, Inventories and Trade, were estimated. In other words, assume that future revisions of Q2 GDP will be lower, not higher, as the actual data comes in, and especially as the CapEx data, which contrary to the GDP report, has not rebounded. Speaking of revisions, today the BEA also released its annual revision of all data from 1999 to Q1 2014, which made last quarter's -2.9% print a more palatable -2.1%, in the process throwing everyone's trendline calculations off as yet another GDP redefinition was implemented.
We are currently combing through the years of revisions and will provide a snapshot shortly but for the time being here is Bloomberg's take:
Big point: the biggest components of the GDP beat, Inventories and Trade, were estimated. In other words, assume that future revisions of Q2 GDP will be lower, not higher
Q2 GDP Surges 4%, Beats Estimates Driven By Inventories, Fixed Investment Spike; Historical Data Revised
That Obama knows what he’s doing! I’ll vote for him!
probably closer to zero once revised down.
...in the process throwing everyone's trendline calculations off as yet another GDP redefinition was implemented.
In other words, they are simply making these numbers up. They are completely meaningless, driven only by the propaganda machine.
All the talking points will be about this , and after the downward adjustments it will zero out somewhere down the road and only reported in some cattle futures magazine in Omaha that nobody reads
“Q2 GDP Surges 4%, Beats Estimates Driven By Inventories, Fixed Investment Spike; Historical Data Revised”
Otherwise... Americans aren’t buying it, in more ways than one.
Meanwhile, ADP says job hires were well “below expectations”.
Obama’s Commerce Department is full of it.
Americans aren’t buying cuz they’re gambling their money away at casinos....
Yes, the phony numbers are equine excrement.
Not a smidgen of accurate data...
And anti depressants.
Yeah, and the unemployment rate really is 6.1%.
And in other news, unexpectedly...
Private Sector Adds 218,000 Jobs in July, ADP Reports
GDP is almost always revised down. That being said it’s not surprising (4% is a huge number but nobody believes it. Just like the -2.9% in 1Q - revised to -2.1% today - is not indicative). At the end of the day the economy will grow 1.5-2.0% for the full eyar. Right where we have been the last couple of years.
More government BS.
LOL - everyone knows this. Every quarter. It is referred to as “Advance” numbers. It’s a “flash” report for those that work in corporate finance. It is always revised (there is a set schedule if you would like it).
And yes they are estimates. Of course they are. You cannot measure the economy exactly. It’s just not possible. Anyone who thinks there is an exact measurement of a $17+ trillion economy is an idiot.
Surge in inventories. That’s got to be channel-stuffing; manufacturers pushing out goods to wholesalers. There will be no sell-through to the retail level; people simply don’t have any discretionary cash anymore. Rent, food, fuel and healthcare inflation and debt service take care of that. Watch for major adjustment of Q2 in the Q3 report.