Before we get going here, note that the GDP estimate put out is preliminary, and subject to at least two revisions before becoming the final numbers. The clunkers in Washington, and the clunker of a President know this, and both likely exert great control over the resultant early happy face numbers put on what is likely to be dismal final data.
For instance, everybody by now has heard that the unemployment for June was 9.5%. But did you know that two weeks ago it was revised downward to 9.7%. So why is everyone talking like it is 9.5%?
Headline: GDP Shrinks at 1 Percent, Sign Recession May Be Easing — From the Washington Post. A totally misleading headline if there ever was one. GDP shrank at a rate of 5.4%, compared to the first quarter, before the ever sure to come revisions downward. For instance, in Q1 the prior to final estimate of 6.4% was -6.1%. Future revisions of Q2 GDP will occur on 8/27 and again on 9/30.
NOTES: This chart above, assumes the ‘advanced first estimate’ is final, which it is not. The recession, defined as two consecutive down quarters in GDP, began in Q3 2008. Y/O/Y change is a less volatile way at looking at GDP growth.
When the GDP came out this morning and there’s only one word for it, Ugly, the headlines focused on the 1%, but what was the truth? Let’s start with the actual government report and it’s weasel wording:
Real gross domestic product — the output of goods and services produced by labor and property located in the United States — decreased at an annual rate of 1.0 percent in the second quarter of 2009, (that is, from the first quarter to the second), according to the “advance” estimate released by the Bureau of Economic Analysis. In the first quarter, real GDP decreased 6.4 percent.
The Bureau emphasized that the second-quarter advance estimate released today is based on
source data that are incomplete or subject to further revision by the source agency (see the box on page 3). The “second” estimate for the second quarter, based on more complete data, will be released on August 27, 2009.
OK, you got that, or did you? Here it is in the clear, GDP went down in the first quarter by 6.4%. In the second quarter it went down 5.4%. Yes, 5.4% total when put back to the first quarter baseline. Or in weasel words, in went down 1% less than it did in the first quarter. But the internals are real ugly, and oh by the way, the States are out of money. The fact that the States are out of money, major major problem going forward.
Source, the real government report here:
Our future debt under Obama is now projected to be 110% of our GDP.
There should be no place in the USA for propaganda, studies or otherwise.
Cash for geezers:
We promise we will do as good as the Cash for Clunkers program.
If you manage to get through the maze, and you are still alive, you may get an appointment with a doctor. After you see the doctor, it’s back to the maze to see what you qualify for.
Cliffnotes version of government run healthcare: Abort the unborn, euthanize the old, save money, give the saving to your Democrat voters.
You know it when you see it.
Obama’s deficit. Note that already in 2007, when the Democrats were running Congress, the deficit was skyrocketing. These very same Democrats were continuously catterwailing against Bush’s deficits.
And yes the meltdown has a source, the Democrats mortgages for deadbeats programs, starting with the Government Sponsored Enterprises Freddie Mac and Fannie Mae. Cute names for government mortgage hustlers aren’t they. In fact Obama has some notables from both on his staff so he should be able to ask them for advice on how they screwed the economy.
Code words for government run disaster in healthcare.
Looks like Barney Frank didn’t get the message. A group that supports the single payer option has gotten Rep. Barney Frank to admit the public option is just a path to a single payer government controlled health care.
I assume, that with obesity, a lifestyle choice, we can cut costs by not paying for diseases that come from obesity. So does that mean that AIDes, a lifestyle choice diseaease that Barney’s Fwank is familiar with, would not be treated to save cost. In both cases, the diseases would die off.
Government suspends cash for clunkers, as costs skyrocket. But don’t worry, government healthcare will be cheaper.
What is really going on though …
As Obama goes on another “blame Bush” kick, talking about the budget woes he inherited from Bush, it’s worth noting the sort of spending growth he and his fellow Democrats have approved this year alone in relation to past years:
The nonsense about it’s all Bush’s fault can be clearly seen in this chart. Notice in 2007 the Democrats started the spending binge.
Initial claims for jobless benefits rose by 25,000 to 584,000 on a seasonally adjusted basis in the week ended July 25, the Labor Department said in its weekly report Thursday.
Last week the number was 547,000. Many people’s benefits are running out and causes the numbers to look lower and fluctuate by reducing the total numbers on the unemployment roles. In addition. people are taking short term work, so they move in and out of the unemployment roles.
Ryan Maue of Florida State University writes in comments:
Global (Northern Hemisphere) tropical cyclone ACE for the months May – June – July is the lowest in at least the past 30-years or more.
I, for one, am not surprised. Continued inactivity should persist for the next few weeks until the atmosphere catches up with the radiative warming of the tropical oceans due to the season called summer.
2007 was a dud. 2008 was saved from being a record year by 2007. 2009 is behind the pace of both years. Amazing how natural variability affects tropical cyclone formation, tracks, and intensity. Who would have thought?
Ryan’s Tropical web page at Florida State University has this graph that shows accumulated cyclone energy (ACE) :
I like it this way.
So how does the recession hurt the USA … While we live with Communist government policies, the Chinese Communists, after figuring out Communsim doesn’t work, have now tried out capitalism.
It’s what you call role reversal, going backwards, what Democrats do best. You elect a Communist, you get a Communist. You did read Odummer’s book on Communism, didn’t you?
How’s the hopey changey working out for you and your 401K.
For additional reading, and weeping, Weak Treasury Auctions Raise Worries About US Debt Burden:
The U.S. Treasury sold $39 billion in five-year debt Wednesday in an auction that drew poor demand, raising worries over the cost of financing the government’s burgeoning budget deficit.
It’s not all bad, it’s gonna get worse.