The first release of GDP data came out this morning with an advance estimate of 2.2 percent growth for quarter 1. Contributions of growth from the major components were: Consumption Expenditures                       2.04 Investment Expenditures                           0.77           Fixed Investment                             0.18           Inventory                                          0.59 Government Expenditures               … Read more

I just finished John Taylor’s new book, First Principles. It’s a very good and fast read. It’s a little over 200 pages, and not a derivative in it. I don’t think there is even an explicit formula in it. Taylor writes very well, especially for an academic economist. Maybe that is from all his years… Read more

This morning’s much anticipated fourth quarter GDP release provides a preliminary estimate of real GDP growth of 2.8 percent. To be fair, perhaps the anticipation is experienced mostly by forecasting economists and financial market watchers. I am always particularly interested in fourth quarter as it closes out the year and in this case I forecasted… Read more

Forecasting is always difficult. It is even more difficult when the data keep changing. This year, we’ve been plagued by very large adjustments to GDP data. Most have been downward adjustments, but a few have been upward adjustments. Productivity has been the source of most of the changes. Jobs data get revised too, but we… Read more

The initial estimate of United States third quarter GDP was released today. The economy grew at 2.5 percent, driven mostly by consumption growth of 2.4 percent and investment in equipment & software of 17.4 percent. Growth was slightly augmented by investment in structures and the improvement in net exports. The government sector’s impact on GDP was… Read more

Previously published September 28 in the “California Economic Forecast”: The saga of the Great Recession continues. Over six million people have been unemployed for more than 27 weeks, and job growth may be slow enough in the next few months that the unemployment rate rises again. Major revisions to GDP, released in late July, show… Read more

Today’s jobs data release was below our forecast, and that is bad. It is even worse, when one considers the productivity data released earlier in the week. That report showed that productivity has fallen in each of the past three consecutive quarters. This is the most sustained decline since 1979. Productivity used to have a… Read more

We’ve seen more and more forecasters and analysts revising their forecast down. In fact, after being among the lowest for years, we’re now almost consensus. Remember, they came to us. Downward revisions to United States gross domestic product (GDP) have driven most of the revisions. For about two years, we had trouble with the original… Read more

Jeffrey Speakes Downgrade On Friday, August 5 after the market close, Standard and Poor’s (S&P) announced a downgrade of U.S. Treasury debt from AAA to AA+. This announcement followed Congressional approval of a debt limit increase and ten year plan to cut projected deficit relative to baseline by $2.1 trillion. Evidently, the debt deal was… Read more

Continuing my commentary on last Friday’s GDP release, here is a chart showing the revisions to real GDP growth. It might seem like some quarters are up and some are down, in effect a wash. Despite that appearance, on net, the new measure implies that growth was slower during the 2007 through 2011 quarter 1… Read more