3 Positive Takeaways From 4th Quarter GDP

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Includes: SPY
by: Hale Stewart

By New Deal Democrat

Aside from the fact that it was positive, there were at least three particularly nice positives in the GDP report for Q4 2015.

First, real residential investment itself, and as a share of GDP, increased:

This typically turns down a year or more before the next recession.

Second, proprietors' income increased. There's no graph available yet, but income increased +0.6%. Typically, but not always, corporate profits follow in the same direction. Again, these tend to turn at least one year out from a recession. I also suspect this series is more attuned to domestic consumption than corporate profits are.

Third, median wages increased:

These increased +0.6% and they are up over 2% YoY. Since this is a median, this is a better measure than average hourly wages. The worker at the 50th percentile is doing better.