Spinning A GDP Disaster

by JASmius

The Obamaconomist fantasy.....:

When the government updates its estimate Wednesday of how the U.S. economy fared last quarter, the number is pretty sure to be ugly. Horrible even.

The U.S. economy shrank at a steep annual rate of 2.9 percent in the January-March quarter as a harsh winter contributed to the biggest contraction since the depths of the recession five years ago. That was its bleakest performance since early 2009 in the depths of the Great Recession.

So why aren't economists, businesses or investors likely to panic?

Because most agree that the economy last quarter was depressed by temporary factors — particularly the blast of Arctic chill and snow that shuttered factories, disrupted shipping and kept Americans away from shopping malls and auto dealerships.

.....and the brutal reality:

Remember when in January 2014, Q1 GDP was expected to rise 2.6%? Well, here comes the final Q1 GDP revision and it's a doozy: at -2.9%, far below the -1.8% expected and well below the -1.0% second revision, it is an absolute disaster, and is the worst print since Q1 2009.

And while a bad GDP print was largely expected, the driver wasn't: personal consumption expenditures somehow crashed from 3.1% to just 1.0%, far below the 2.4% expected, meaning that all hope of a consumer recovery is dead. Finally, as a reminder, US GDP has never fallen more than 1.5% except during or just before an NBER-defined recession since quarterly GDP records began in 1947. Good luck department of truth propaganda machine, because even assuming 3% growth every other quarter in 2014 means 2014 GDP will be 1.5% at best.

This GDP collapse was not the result of it being a bit nippier outside than normal.  It's is the result of Obamanomics, ObamaCare, and pretty much the entire "fundamentally transformative" White House agenda.  Period.

It does, though, help explain Hank Paulson's ridiculous punchline from yesterday.  Impose carbon tax, shut down energy production, eliminate "carbon pollution," and voila!  No more nippy winters, and prosperity flows like a middle aged man's urine after an overdose of FloMax.



The more likely result?  The Obamapression's second "official" recession and "negative growth" for 2014.  Which will be due to an unusually hot summer, of course.  People indiscriminately taking off their clothes and keeping each other away from shopping malls and auto dealerships and such.

Boy, global warming sucks, doesn't it?