You will want to have at least two cups of coffee on the burn this morning in order to sort through the monthly Gross Domestic Product data just out from the Bureau of Economic Analysis.
That’s because in any college finance class, we we all taught to FIRST report some kind of a baseline hard number and then reference all following percentage changes to that hard number.
Well, as we continually complain around here, the way the BEA works, they don’t bother with such economic niceties: The just launch into a double-triple serving of self-referential percentagizing ( if I can take some indecent liberties with language here) as they assume that you’ve remembered enough quadratics from school that you can solve for X if you really cared to get to the bottom of things.
Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 2.5 percent in the second quarter of 2013 (that is, from the first quarter to the second quarter), according to the “third” estimate released by the Bureau of Economic Analysis.
In the first quarter, real GDP increased 1.1 percent. The GDP estimate released today is based on more complete source data than were available for the “second” estimate issued last month. In the second estimate, the increase in real GDP was also 2.5 percent.
With the third estimate for the second quarter, the general picture of economic growth remains largely the same (for more information, see “Revisions” on page 3). The increase in real GDP in the second quarter primarily reflected positive contributions from personal consumption expenditures (PCE), exports, nonresidential fixed investment, private inventory investment, and residential fixed investment that were partly offset by a negative contribution from federal government spending. Imports, which are a subtraction in the calculation of GDP, increased.
Well, of course they did! (WTF?) As the late Billy May said “But wait! There’s more!!!”
The acceleration in real GDP in the second quarter primarily reflected upturns in exports and in nonresidential fixed investment, a smaller decrease in federal government spending, and an upturn in state and local government spending that were partly offset by an acceleration in imports and decelerations in private inventory investment and in PCE.
The price index for gross domestic purchases, which measures prices paid by U.S. residents, increased 0.2 percent in the second quarter, 0.1 percentage point less than the second estimate; this index increased 1.2 percent in the first quarter. Excluding food and energy prices, the price index for gross domestic purchases increased 0.8 percent in the second quarter, compared with an increase of 1.4 percent in the first.
And on the consumption side?
Real gross domestic purchases — purchases by U.S. residents of goods and services wherever produced — increased 2.5 percent in the second quarter, compared with an increase of 1.4 percent in the first.
As usual, the public has no clue where there was actually any improvement in the standard of living because we have no clue whether there was actually any increase in goods sold, since such reports tend to a) not report unit volumes and further, the application of effects of monetary inflation are murky at best.
Still,l the meek and mild mannered Wall St. Hyper Machine goggles this stuff up. And so, as a result, look for the market to rally at least 50-points today.
Not because we have any more jobs, not because we have any more time off, goods consumed, but more likely because this is an increasing collection of + symbols in a press release, and by God, that has to be good for ‘Merica, right?
And besides, any website (like this one) that cites BEA GDP data and then starts talking about how the Federal Reserve has pumped at least 6.8% more paper (52 week, H.,6 money stocks report, give or take a too big to fail) impacts, must sure be an al Qaeda affiliate, or worse, an independent thinker and voter.
Hell, this is just the NY Times Crossword version of economic reports, is all I’m saying. Except the real answer is never printed, but is hidden in the unemployment and home repo numbers…just saying.
That’ll be two eggs, bacon, and 16-simultaneous quadratics in Excel, please. Oh, and more coffee. Got any ViceGrips or Jack laying around?
More after this…
The headline on the Atlantic Wire is bound to come as a shocker to some: Former president “George H.W. Bush Quietly Endorses (At Least One) Same-Sex Marriage.”
The term “blow boats” has new meaning to New Zealanders after seeing the US America’s Cup team do an amazing come-from-behind win of nine straight victories in the sailing out in the San Francisco area. leading to collections of best tweets about the event.
One of the better Kiwi zings went to the idea of “You may have the Cup but we have affordable healthcare…”
D’oh! (or is that dough?)
I recently mentioned that Greenpeace activists being arrested following their boarding of a Russian oil rig in the Arctic.
But, now, according to this report, Vlad Putin will not be pushing for piracy charges against the perps.
Oh, wait. Is that maybe a little wishful thinking/public relations work? The RT coverage of the case has a little different slant on things with this quote:
“Russian President Vladimir Putin has declared that the defendants are “obviously not pirates,” but technically fit the charge, as they were trying to forcefully board and take over the rig, which is a violation of international law.”
Don’t look now, but the Russians are playing this like a fiddle. They’ll orchestrate it to whatever ends, and with 30-protesters on ice (in two manners of speaking) so we look for Russia to leverage on Greenpeace in the future in return for…what? Easy going on this one? Hmmm…
The idea that we should be having a couple of 7+ quakes this month has turned out not so much a prescient prediction of future, so much as just looking at the spread of the data (a really good, short discussion of which can be found over here…). And, you remember of the 7+ earthquake chart up earlier this month (here) that 1.5 to 1.7, or so, 7+ quake seems to be somewhere around present central tendencies.
So what we have had in the past week is the 7.7 in Pakistan and, more recently, the 7.0 down in Peru.
On the other hand, we’re in the blessed position of being able to be “up the hill” to an elevation of more than 600-feet about sea level, should there be a major SF impacting quake, and we can be up there in less than 10-minutes, I reckon.
Still, these quakes are reminders that have me putting on my “nag hat” this morning:
You can never have too much back-up water supply, never have too much stored food (as long as its part of a rotation system and you’re not wasting/throwing things out) and have a “higher ground” plan.
To be sure, 600-feet of elevation may not seem especially high, particularly if you are an incredible worrywart, but again, it’s one of those spread of the data things. Since we’re not up at the headlines of Latuya Bay, where one of the highest-ever scientifically studied mega-tsunamis happened, 600-feet seems a reasonable level for most all event, save maybe the passing of a planet-sized object in space.
If you insist on worrying about such things, the way odds work out, it’s only a small step from a tsunami over 600-feet to the Earth’s atmosphere being ripped off by the passage of a celestial object, as all former residents of Mars may recall.
We notice (besides the expected uptick in earthquake activity) that there has also been a change in the outlook for ocean levels between now and the year 2100…which, sadly, we won’t be around to see (unless the Astralagus does a miracle, see more about this in this morning’s Coping section).
The latest seems to say that ocean levels could rise between 10.4 and 30-some inches and this could cause flooding issues for “millions of people.”
Of course with that new land rising this week, there may be some compensatory topographical changes. But two points in passing here: One is that some evidence suggests that the world’s highest lake used to be at sea level and popped up to its present altitude in a matter of weeks. And the other is that the Earth has always been in a constant state of geological change.
No reason for those macro-trends to quit now, for no particular reason.
Still, as long as we’re on the general topic of trends and calling reversals, keep in mind that the output from the Sun is the major driver, and after a protracted period of higher-than-average output, the Sun has gone into something akin to remission, as the solar sunspot counts are peaking at values of less than a third of what they were in prevision (recent) cycles.
The thing is, it takes time for all the solar output changes to fully work their way into the Earth’s weather systems, which thanks to atmospheric mixing, acts like putting drops of food coloring into a running blender. In other words, it takes a few seconds for the drops to be completely and uniformly mixed in. Except, of course, that seconds on the geological time-time might be a couple of decades.
For the moment, looks like North America will have a somewhat “normal” fall, except, of course, for the outlier events. Like Denver a couple of weeks back?
And that grinds us along into this morning’s Coping Section…