GDP Q4 : -0.1% vs. +1.0% consensus, +3.1% prior.


GDP Q4 : -0.1% vs. +1.0% consensus, +3.1% prior.
Comments (25)
  • Mike Maher
    , contributor
    Comments (2862) | Send Message
     
    Unreal. Thank you Congress!
    30 Jan 2013, 08:32 AM Reply Like
  • youngman442002
    , contributor
    Comments (5123) | Send Message
     
    big recovery...but the markets close to hitting all time highs.....anyone see anything wrong here???
    30 Jan 2013, 08:35 AM Reply Like
  • bbro
    , contributor
    Comments (11223) | Send Message
     
    Don't be fooled by the headline number...internals pretty strong...
    30 Jan 2013, 08:37 AM Reply Like
  • Mike Maher
    , contributor
    Comments (2862) | Send Message
     
    A decrease of government spending by 15% and only seeing GDP drop 0.1% is actually a bit impressive. The 7.9% jump in personal income is also encouraging. Savings rate also up.
    30 Jan 2013, 08:43 AM Reply Like
  • GaltMachine
    , contributor
    Comments (2071) | Send Message
     
    bbro,

     

    While it's important to look for the positive, it is indeed a negative number so sometimes a cigar is just a cigar after-all.

     

    This is of course before the onset of the recent tax increases so in theory this quarter should be worse which means ....????
    30 Jan 2013, 08:48 AM Reply Like
  • dancing diva
    , contributor
    Comments (2731) | Send Message
     
    Gait - this was by far the best no growth quarter I've ever seen. Two components, Federal Spending, down 15%, and Inventories accounted for roughly a 3% drop - had they been flat, gdp would grown by about 3%.

     

    Now I've always had a problem how inventories are counted. If they're growing, that's supposedly a positive for gdp - yet it means supply is outstripping demand. Last quarter they were being drawn down, which is a good thing for future growth, but they subtracted from gdp.

     

    I don't think Q1 will be particularly strong with lackluster business and consumer spending (which were large in Q4), but I don't look for a big drag from either govt or inventories - inventories should add to gdp. It's still early yet, though it's really too hard to predict anything yet since we've barely started to see January data.
    30 Jan 2013, 08:52 AM Reply Like
  • Interesting Times
    , contributor
    Comments (15026) | Send Message
     
    Mike

     

    With a 2 % increase in payroll taxes don't expect the next quarter to be much better!! The market will react accordingly!!

     

    Better buy your metals soon!!
    30 Jan 2013, 08:52 AM Reply Like
  • bbro
    , contributor
    Comments (11223) | Send Message
     
    I am not looking for the positive...There is a set of numbers in GDP that are very important to follow in relation to GDP....they have improved...that is all the hint I am going to give....have a great day...
    30 Jan 2013, 08:54 AM Reply Like
  • Interesting Times
    , contributor
    Comments (15026) | Send Message
     
    bbro

     

    Whatever makes you sleep better...This was way overdue with all the manipulation...Put whatever spin you want on it !!
    30 Jan 2013, 08:57 AM Reply Like
  • GaltMachine
    , contributor
    Comments (2071) | Send Message
     
    bbro,

     

    " that are very important to follow in relation to GDP....they have improved..."

     

    Calculated Risk has a very good overview of that here:

     

    "Personal consumption expenditures (PCE) increased at a 2.2% annualized rate, and residential investment increased 15.3%, equipment and software increased 12.4%. That is a solid increase in fixed investment."
    Read more at http://bit.ly/XipEN4

     

    I get that. All I am saying is that we had a negative GDP number before the impact of the recently passed taxes has taken effect.

     

    So in theory this could be a negative quarter which would make two consecutive negative quarters, isn't that a recession?

     

    I must admit, I am bamboozled by this development and having followed you for years, I suspect you are as well.
    30 Jan 2013, 09:45 AM Reply Like
  • mrdirt
    , contributor
    Comments (762) | Send Message
     
    Most of Govt reduction was on Defense Spending, other Govt expenditures increased.
    30 Jan 2013, 10:11 AM Reply Like
  • WMARKW
    , contributor
    Comments (10787) | Send Message
     
    There are three important factors that are working to reduce GDP on a go-forward basis. Population growth is slowing. Demographics with the "boomers" is working against GDP and productivity is the third. All will combine to gether to keep downward pressure on GDP. I believe 1% will be the new normal.
    30 Jan 2013, 11:03 AM Reply Like
  • Interesting Times
    , contributor
    Comments (15026) | Send Message
     
    WMARKW

     

    Don't forget that new 2% payroll tax!! That is going to drag GDP down as well. A ton of people i know personally aren't happy with less money weekly, while oil is heading up with gas prices to follow soon as well..
    30 Jan 2013, 11:10 AM Reply Like
  • wyostocks
    , contributor
    Comments (9114) | Send Message
     
    Every Joe\Jane on Main Street saw this coming; only the "experts" are surprised.
    30 Jan 2013, 08:38 AM Reply Like
  • Interesting Times
    , contributor
    Comments (15026) | Send Message
     
    Some of us have been waiting for this!!!

     

    Watch the metals take off soon...Ben didn't have a good nights sleep for sure!!
    30 Jan 2013, 08:44 AM Reply Like
  • JoseV
    , contributor
    Comments (401) | Send Message
     
    Here we go again, the sky is falling!!!
    30 Jan 2013, 08:58 AM Reply Like
  • Interesting Times
    , contributor
    Comments (15026) | Send Message
     
    JOSE

     

    Go do somedue diligence and maybe you will understand the full picture here...You choice..I am only the messenger..

     

    Looking to read all the spinning on this...amazing!!
    30 Jan 2013, 09:05 AM Reply Like
  • WMARKW
    , contributor
    Comments (10787) | Send Message
     
    Jose,
    Please provide an indication of why you think the sky is NOT falling?
    30 Jan 2013, 11:04 AM Reply Like
  • davidparent
    , contributor
    Comments (10) | Send Message
     
    Q3 was distorted higher by inventories and Q4 was distorted lower. Call it a wash. Tax increases will have no meaningful impact on growth, but March 1 sequester, plus any further cuts in spending will produce a decline in aggregate demand.
    30 Jan 2013, 09:04 AM Reply Like
  • GaltMachine
    , contributor
    Comments (2071) | Send Message
     
    David,

     

    "Tax increases will have no meaningful impact on growth"

     

    How do you know that? What theory is that based upon?
    30 Jan 2013, 09:47 AM Reply Like
  • Interesting Times
    , contributor
    Comments (15026) | Send Message
     
    DAVID

     

    "Tax increases will have no meaningful impact on growth, "

     

    Sorry but you are dead wrong..That 2% payroll tax increase gives the consumer less money to spend..Hence GDP WILL be effected!!

     

    Now lets not even think about the fiscal cliff!!!!!
    30 Jan 2013, 09:51 AM Reply Like
  • Bioalchemy
    , contributor
    Comments (175) | Send Message
     
    Don't worry, this crazy market will be still buying
    30 Jan 2013, 09:16 AM Reply Like
  • Interesting Times
    , contributor
    Comments (15026) | Send Message
     
    YLIU

     

    Maybe not, even though it's a rigged market some folks are going to be scared away...Can't wait to read all the posts how this is actually good news from all the bulls!!

     

    Bring it on guys....Gold pre-market up $15 bucks already!!
    30 Jan 2013, 09:19 AM Reply Like
  • Interesting Times
    , contributor
    Comments (15026) | Send Message
     
    This is almost comical, the FEDS minutes were rel;eased a few weeks ago and the markets did a complete 180 once a HINT was dropped that QE i MIGHT end and some here think the fundamentals are ok??

     

    Serious?

     

    "Europe is going into a recession. All US citizens just got a tax increase that should reduce US GDP which means less business. Meanwhile, the market is moving up or moving sideways??

     

    I think the market is being manipulated which means all bets are off. I am in a defensive investment posture now."

     

    From a trader i trust !!!! Strap in folks..
    30 Jan 2013, 10:17 AM Reply Like
  • Shakaama
    , contributor
    Comments (6) | Send Message
     
    From my very unskilled analysis, I think a few things are going on here.

     

    1. I think this number is completely manipulated. I don't think GDP went down 0.1% I would venture GDP is down3% - 7%.

     

    2. we are still not getting anywhere near the real unemployment / labor rates. millions have fallen out of the labor pool and are not being counted. not only are they not counted, they will not be returning because their jobs are not returning. The millions of jobs we lost almost none will return.

     

    3. the 3% tax hike on payroll / income is not new, but you then have to remember back to 2008 when Obama promised to "lower" taxes, only to lower the front end and raise the back end, so that paychecks did not go down, but up. in the aggregate, main street is on the chopping block.

     

    4. there is no 0% tax rate bracket any longer. this is unprecedented. i don't even know what they hope to gain from people that make $10,000 / yr. it will push them to get onto public assistance, which will be more than they could ever hope to contribute in income taxes. its a shot to the groin area, in my opinion.

     

    This tiny bit of news is just one piece in a very large puzzle. we cannot concentrate on this one piece and make judgments just based on this one pice, but must fit it into the entire tapestry and then make judgments.
    30 Jan 2013, 06:53 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs