A lot of ink is being spilled over the inventory numbers in the gdp report.
So I though I would just post on one of the available monthly data series on inventories.
This shows that the real I/S ratio fell sharply in March. But the gdp report includes no
data on March inventories. This implies that the next revision of real GDP will be down,
but that there is little reason to expect a rebuilding of inventories in the future to boost growth.
It is part of the great moderation that in todays world firms do not allow inventories to get way out of line and this sharply reduces the odds of a recession. We could still have a recession, but it
will not be a classic inventory cycle.