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7/30/10 Midevening Report: GDP goes down again, claims it likes the taste

|Includes: C, MET, MRK, TeleCommunication Systems, Inc. (TSYS)

The big macro news today was that GDP slowed to 2.4% growth in Q2, that is until it's revised down next Q to keep up with the administration's "hold the shock and hope for no awe" strategy.  This strategy was further evident in today's release as GDP from the past 3 fucking years was revised downward because apparently the Commerce Department is still figuring out how to properly use the "solver" function in Excel.  The peak to trough decline is now seen to have been a 4.1% decline instead of a 3.7% drop, which officially makes this recession the worst since the 1940s which was so long ago that Abe Vigoda had only been dead for a decade and muff guessing still referred to fashion designers trying to figure out the latest in hand warming trends.

Surprisingly though, and in direct opposition to the downward revision strategy,  last quarter's GDP was revised up to 3.7% from 2.7% which makes today's number even worse.  It also goes against every fucking rule of manipulating data since, you know, the whole point of manipulating data is to use it to your advantage but apparently the new guy at the Commerce Department must have missed the memo while he was busy figuring out how to put a cover sheet on his fucking TPS report. 

So GDP was below guesses of 2.6% growth and was mostly hurt by a trade deficit growing wider than the Octomom's cervix with imports spiking up 28% which is the largest jump in 25 years since the run on french cookies in the mid 1980s, consumer spend slowing to only 1.6% growth after growing 1.9% last Q, and a renaissance of common sense.  The one bright spot Money McBags could find was Jasmine Waltz, and the one bright spot he could find in the GDP report was that the equipment and software category grew at an annual rate of 21.9% as businesses need to buy a bunch of shit to do what people used to do.  The slower GDP growth comes a day after Fed Bank of St. Louis President James Bullard published an academic paper warning of the potential for the US economy to hit a period of deflation and turn in to Japan from 20 years ago which would be bad for everyone but the bukakke industry. 

GDP is now slowing down, the economy has lost 8.4MM jobs, and Christina Hendricks still has not agreed to make a late night Skinamax movie, so any hopes of a speedy, stimulus driven recovery are becoming slimmer than Amy Fisher's parents hopes and dreams. Money McBags is sure the Fed will announce something soon to try to kickstart the economy, but based on the fact that they have been in existence for 100ish years and still haven't figured shit out (largely because economics is a more full of shit field of study than proctology), he's not holding his breath (though he would gladly hold anything of Hayley Atwell's).

In other US macro news, the University of Michigan's consumer sentiment index fell to 67.8 which is the lowest level since November and 10% below the 76 number it registered last month (though to be fair, it registered such a high number last month because it had put the thermometer next to the heater in hopes of being able to stay home from school).  As always, Money McBags...READ MUCH MORE....ANALYSIS OF TSYS....

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