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More on Q3 GDP: Real personal consumption +2% vs. +1.5% in Q2. Residential fixed investment...

More on Q3 GDP: Real personal consumption +2% vs. +1.5% in Q2. Residential fixed investment +14.4% vs. +8.5%. Federal government expenditures +9.6% vs. -0.2%. Real final sales +2.1% vs. +1.7%. Prices +1.5% vs. +0.7%. Quickly rebounding stock index futures are given another boost by the beat, the S&P 500 flat after being down about 1%.
Comments (25)
  • Federal government expenditures +9.6% vs. -0.2%.

     

    Must have a lot of funds on hand with national government debt at meager $16 TRILLION now.
    26 Oct 2012, 08:56 AM Reply Like
  • Pretty standard practice known in the federal gov't it is called burning out the 'year end' budgets before it evaporates. Timing is suspect though, coincident with the elections?
    26 Oct 2012, 03:42 PM Reply Like
  • They have the printing press.
    26 Oct 2012, 07:27 PM Reply Like
  • So, most of this "upside surprise" is just the federal government pumping out money that it doesn't have to buy votes for the upcoming election? That about cover it?

     

    Yeah, this "recovery" is humming right along. We set a new record for people collecting federal disability checks this month, too (up to almost 9 million), in case you were wondering where those unemployed folks were going once they magically disappear from the UE rate.
    26 Oct 2012, 09:03 AM Reply Like
  • Government spending up 9.6% and the market is humming. The world's largest ponzi scheme (The Federal Reserve) will eventually be exposed. This can't go on forever and we are getting close to the tipping point. If Madoff was sentenced to 150 years, we should give Greenspan and Bernanke 150 centuries. This will end bad.
    26 Oct 2012, 09:15 AM Reply Like
  • And the sheeples will all need to be given 1500 years for not standing up to this (with the exception of the OWS guys, at least they tried). I am not a big fan of Bernanke and all these money printing, but he is doing the equivalent of a poker show hand.
    Something will come out of this, good or bad, if it's good, then we all breathe a sigh of relief, if it's bad, then at least the conclusion will come soon enough. Better than Japan's 20 years of zombie hopping.
    26 Oct 2012, 10:13 AM Reply Like
  • The OWS types want MORE government handouts and a LARGER nanny-state. They didn't stand up for anything more than their own perpetual adolescent, selfish, chronic malcontented interests.
    26 Oct 2012, 01:42 PM Reply Like
  • It is amazing how government spending is put on the same footing as private sector spending. So the government can pump up GM's sales by buying a bunch of Volz. Since the federal government has no money with taking it out of the private sector, no government spending nor government employment should be counted in anything.

     

    Samuel
    26 Oct 2012, 09:13 AM Reply Like
  • NQ is the worst breaking below the 200ma support yesterday after the AAPL Earnings Report.

     

    Internally, NQ Intraday 24-hr 240min Chart wavecount is a Triangle. On the Daily Chart, it may actually be undergoing a 1-2-3-4-5 run down or a Complex Spiral Meltdown if it keeps plunging:

     

    = NQ Daily Chart: http://bit.ly/RkgHml

     

    This rally from June 4 is devilishly hard to interpret including the last 24 trading days of pullback that may either be a Complex Flat for Dow Jones and SnP500 or a Simple Triangle at their current forms.

     

    We will know soon whether they are Either/Or depending on the next several days of price actions or a Neither/Nor if the Consolidation Phase kept extending for possibly another 24 trading days.

     

    For Now: I bought some SSO Day-Trades yesterday using the 15min Divergence Buy Signal. The YM and NQ Intrepid Trades were stopped out for small losses after the AAPL report. I bought them back near their bottoms when AAPL was testing it's 200ma support of $588 using the 24hr chart (for AAPL).
    26 Oct 2012, 10:15 AM Reply Like
  • Surprised you place any credibility in Chinese tech stocks, much less recommend such exposure in this investing environment. Seems much closer to betting on the roulette wheel than any serious analysis.
    28 Oct 2012, 09:43 AM Reply Like
  • Federal gov expend grew 31 bill...GDP grew 190 bill...16% of the growth...GDP has grown 4% y-o-y..Federal Gov expend. has grown 1.1%
    y-o-y
    26 Oct 2012, 10:52 AM Reply Like
  • Election fodder. This GDP number is the 1st estimate. The real worry is the continued drop in real nonresidential fixed investment.

     

    "Real nonresidential fixed investment decreased 1.3 percent in the third quarter, in contrast to an increase of 3.6 percent in the second."
    "Real federal government consumption expenditures and gross investment increased 9.6 percent in the third quarter, in contrast to a decrease of 0.2 percent in the second."
    26 Oct 2012, 11:04 AM Reply Like
  • Get the real picture...look at the real growth rates for Federal government consumption over the last 2 years

     

    2012 03 9.598748764484500 %
    2012 02 -0.234374899299239
    2012 01 -4.224549177157540
    2011 04 -4.400090366972940
    2011 03 -4.316038465083830
    2011 02 2.731268773395850
    2011 01 -10.321322013324000
    2010 04 -4.080169560683080
    2010 03 3.637869543764390
    26 Oct 2012, 11:09 AM Reply Like
  • People see what they want to see, do nothing and complain either way. People who are interested in making money see what is presented (wether they like it or not), try to understand it, try to come up with a conclusion, invest accordingly, and profit from it.

     

    An investor's job is not to like or dislike the news, but rather, to profit from the news regardless of whether he likes or dislikes the news!
    26 Oct 2012, 01:10 PM Reply Like
  • What you say is true, But if one isn't converting those profits into something more durable than fiat currency then it's all a waste of time. Might as well go fishing.
    26 Oct 2012, 07:32 PM Reply Like
  • I would look for the headline figure to creep down from 2.0% to
    something closer to my estimate of around 1½% when all of the data are in.” — Stephen Stanley, chief economist, Pierpont Securities.

     

    as they have done with the weekly unemployment claims number for years the GDP number is always revised downward down the road. On with the recovery, available 24/7 on all channels.
    26 Oct 2012, 01:50 PM Reply Like
  • Yep, the revisions always seem to be downwards when they finally come out.
    26 Oct 2012, 07:45 PM Reply Like
  • The key takeaway here is that outside of the government sector, which goosed the numbers this quarter, growth at the consumer and corporate levels was weak at beat.

     

    0% corporate profit recovery is underway.
    26 Oct 2012, 05:10 PM Reply Like
  • Easy to spend other peoples money
    and of course a 9% govt. increase will create economic activity.
    Chavez does the same thing and he got elected also.
    26 Oct 2012, 07:45 PM Reply Like
  • I think it is time to leave the market before it crashes.
    http://seekingalpha.co...
    26 Oct 2012, 11:18 PM Reply Like
  • SAL

     

    I am sitting on all dry powder right now!!
    27 Oct 2012, 07:19 PM Reply Like
  • anyone with military background and experience
    knows how the game is played at the end of
    the fiscal year.
    subtract out the "boost" from the dod
    expenditures and your gdp number is
    closer to reality
    27 Oct 2012, 07:42 AM Reply Like
  • No wonder they got over that 1.9% number!!!
    27 Oct 2012, 09:29 AM Reply Like
  • "Government spending up 9.6% and the market is humming. The world's largest ponzi scheme (The Federal Reserve) will eventually be exposed. This can't go on forever and we are getting close to the tipping point. If Madoff was sentenced to 150 years, we should give Greenspan and Bernanke 150 centuries. This will end bad."

     

    Yes, it can go on forever and it will. The Great Depression did not bring history to an end, neither did the Black Plague. Have you noticed that we're still here and don't live in caves?

     

    The end of the world is harder to arrange than you think. One reason you're wrong is that you don't see that debt is tied to growth. And though it might sound a bit odd to say, bubbles do not play a purely negative role. They are an inevitable byproduct of expansion cycles, best controlled by an evolving regulatory scheme. I see bubbles as the decadent late phase of expansions where investment psychology gives way to gambling.

     

    This causes problems for analysis since preconceived ideas usually say that phenomena are all good or bad. The cure is to pay attention to how things work and try to figure out how we got here, and the answer to all "end of the world" theories is that so far they have been 100% wrong. Why is that, do you think?

     

    The Second Law of Thermodynamics says you can't get more than you put into a closed system. I see three possibilities applying this to the economy:

     

    1) The Law is wrong and here is my Perpetual Motion machine. Wanna invest?

     

    2) The Law is correct and correctly applied to the economy. There is no free lunch and economic growth is a Ponzi scheme when assisted by government and requires no explanation when done by private parties (?). An expanding pie is an optical illusion, all you can do is fight for the biggest piece.

     

    3) The Law is correct but misapplied to systems that are not closed, receiving vast amounts of energy from the Sun which supports life, expanding agriculture, industrialization and an endless supply of Kenyan Socialist parasites. Let's count coal, oil, gas, wind and solar energy as positive sum inputs into our not very closed system. The government flywheel counters the time decay factor (assets and skills decay during slumps), moves forward investment surplus to when it's needed. The saved wastage is the "free lunch". :-)

     

    I vote for Door #3.

     

    How much government we buy with our surplus is a source of endless bickering, in part fueled by misunderstanding about the nature of growth and how it comes about. You have increased population, technological advance which gives you more work with less input, and social advance, as when government figures out that well fed and educated soldiers fight better, and then generalizes the lesson for everyone and everything.

     

    "Easy to spend other peoples money"

     

    I thought the money came from thin air, I must have been napping. If it did than it might make your money worth less, though you have to figure how much money you'll have if the economy continues to improve.

     

    Since expensive money, which we all would like if we had lots of it, doesn't promote growth, it's a bad deal unless you're a creditor who feels richer as the world gets poorer. For everyone else, the value of money is best set at the level that provides the most income for average people. That's important, while the value of the dollar, its "intrinsic value", isn't, except as a means to a worthwhile goal.
    27 Oct 2012, 12:32 PM Reply Like
  • Republicans or democrats spin is the same; GDP revised downward unemployment claims upward. They've been playing that game for over 4 years. a bad story remains a bad story no matter how much lipstick you put on it. What is not the same this quarter, earnings and revenues missing already downwardly revised numbers.
    27 Oct 2012, 07:59 PM Reply Like
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