Goldman Sachs: The World’s Economy Is In Contraction
What?
Do you mean to tell me that cheap oil and trillions upon trillions of dollars of government stimulus and deficit spending aren’t working?
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UPDATE, 11:45 A.M.: Related, but tying back to fourth quarter GDP, which seems destined to fall sharply from its originally reported annualized 2.6 percent —
Monthly GDP declined 0.6% in December, and growth for November was revised down by three-tenths. The decline in December reflected a sharp deceleration in PCE and a large decline in net exports; nonfarm inventory investment declined somewhat.
Unfortunately, I could not determine Macroeconomic Advisers’ original or resulting November values.
If Macro Advisers is right, then to even hold a 1.6% annualized result, October and November need to have advanced by a half-point each, or (ignoring compounding) an annualized rate of 6 percent each month. That would net out to +0.4 percent for the quarter (0.5 + 0.5 – 0.6), which would annualize to +1.6 percent.
That doesn’t seem likely. Again if Macro Advisers is right about December, a 1 percent or lower reading (which even then would require a quite robust 0.425 percent raw advance in both October and November [5.1 percent annualized]), is not at all out of the question.
[...] The 2007-2014 figure is virtually destined to come down a tiny bit because of impending downward revisions to the initial fourth-quarter annualized GDP result of 2.6 percent. Barring a big upside data surprise in the next few business days, 2.0 percent seems to be pretty much the best hope. 1 percent or lower is not at all out of the question. [...]
Pingback by BizzyBlog — February 21, 2015 @ 1:19 am
[...] I noted at my home blog on Friday: If Macro Advisers is right, then to even hold a 1.6% annualized result, October and [...]
Pingback by BizzyBlog — February 21, 2015 @ 9:56 am