Another look at GDP
(Dan here….Lifted from comments here)
You can download the most recent GDP in excell form directly from the BEA.
In the 2nd quarter exports accounted for 1.12 percentage points of the 4.1% surge in real GDP. That is almost 30% of growth.
Apparently the big jump in exports was due to large purchases of soy beans in May, before new tariffs were imposed. This was obviously a one time unusual event that will quickly reverse and dampen real GDP for the rest of the year.
The y/y growth in real GDP is now 2.8% VS 2.6% in the first quarter. Interestingly, from 2012 to 2016 under Obama there were 6 quarters when the y/y growth in real GDP exceeded 3%.
Soybean sales would be in exhibit 7 of the trade report:
there was a $1,956 million increase to $4,142 million in our exports of soybeans…
i’d note that there were concurrent big decreases in our exports of oil & oil products which could reverse as well…
meanwhile, an inflation adjusted $58.2 billion downward swing in inventory growth subtracted 1% from the 2nd quarter’s growth rate…the -27.9 bilion Q2 inventory figure was the worst contraction going back at least 6 years (looking at the extent of the pdf table)…so just a modest increase in inventory growth in Q3 could add that 1% right back…that would cover the expected reversal of your exports…so other components being equal then, we could see another +4% in Q3…
to clarify; my inventory GDP numbers are at an annual rate, soybeans are unadjusted for May only…
Why I call all of this The Soybean Boom!
the inflation adjusted change in private inventory figures in billions of dollars for the last 10 quarters were as follows:
50.7 17.8 -14.1 39.1 -2.4 11.9 64.4 16.1 30.3 -27.9
the first quarter was +30.3 B, maybe higher than the average, but nothng i would call bloated…consideing the 27.9 B drop in the 2nd quarter, a 30.3 increase in the 3rd is certainly possible…that would add back the 1% annualized drop that reduced 2nd quarter GDP..
btw, i’m not forecasting another +4%, i’m just speculating on what is possible…
I will trash Bert’s comment…he is allowed only one name here…his comment is a bit of trolling.
Not that I disagree with the 5:30 comment but that was not from me.
Bert likes to impersonate other commenters.
It was Bert who uses multiple names. If he would use one name, he could stay. So far he refuses to do so. I thought you were arguing with yourself.
charts on gdp, unemployments etc.
while proofreading my GDP coverage, i pulled up the Fred graph for the real change in private inventories:
this quarer’s contraction was the largest drop since the 4th quarter of 2009. all other drops of this magnitude were in or coming out of recessions; 2008 and 2009, 2001, 1980, 1982 and 1983
i dont usually look at personal income and savings data in the GDP report, but now i see a major revision that flew under the radar..
personal savings came in at a $1,049.7 billion annual rate in June, up from the revised $1,047.1 billion in personal savings in May…as a result, the personal saving rate, which is personal savings as a percentage of disposable personal income, was at 6.8% in June, same as in May…hence, as a result of a large upward revision to personal income and a slight downward revision to personal consumption expenditures, that savings rate has more than doubled from what had previously been published….in May’s report, personal savings were at a $482.0 annual rate, and the savings rate was at 3.2%…
i dont know where they found the extra personal income, but it sure calls into question the meme that consumers are tapped out…
income and outlays pdfs for the month before the revision, and the month after:
see line 43, table 1 in both
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Welcome to Angry Bear blog. First comments always go to moderation to weed out spammers and advertising.
via the Atlanta Fed’s GDP now:
After this morning’s advance durable manufacturing report from the Census Bureau, …the nowcast of the contribution of inventory investment to third-quarter real GDP growth increased from 1.92 percentage points to 2.03 percentage points.
so, if my guess that inventories would add a full percentage point to 3rd quarter GDP was crazy, it was only half as crazy as the Atlanta Fed…