Sunday, January 29, 2012

US GDP: Do you recognize a pattern?

So US GDP data was out last Friday. Slightly slower than expected at +2.8% QoQ annualized rate vs +3.0% expected.

What about it?

Inventories represented around +1.9% of this number while "Real final sales (GDP less inventory changes) expanded at an anemic 0.8% annual pace in the fourth quarter, a sharp slowdown from the third quarter’s healthy 3.2% rate. That paints a different picture from the apparent pick-up in headline GDP growth from the third-quarter’s 1.8% yearly rate. The difference reflects the shift to inventory building in the fourth quarter from a drawdown in the third quarter.” (Barron’s)

Now check out the interesting pattern since 2009... 1Qs numbers as the lowest in the years and the increase towards 4Qs highs.

The loss in growth momentum is evident.
Now consider many years of gigantic fiscal and monetary stimulus.
How healthy is the underlying situation?

The clash of titans this year in the macro landscape is DM austerity x EM monetary easing.

Who will win with crude oil averaging very high levels?

Posting from iPad for the first time.. through an App designed for the iPhone... Google really is focusing on expanding Android's base.

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