GDP has Mostly Been a Disappointment - What Now?

Mish Shedlock  |

Yesterday morning, the BEA reported Second Quarter GDP was 2.3%. That was at the low end of the Consensus Range of 1.9% to 3.5%. On the plus side, though, the first quarter was revised way higher.

GDP is the most lagging of all indicators. By the time all the revisions are in (years later), no one even cares. I suspect after the "final" revision, first quarter 2015 GDP will be back in the negative column, with all of 2015 revised lower as well. Don't hold your breath waiting.



Meanwhile, the first half of the year looks pretty weak. Last year, a first quarter GDP of -0.9% was followed by a huge second quarter surge to +4.6%, sustained with a strong third quarter at +4.3%. In comparison, this bounce was feeble.

If retail sales do not pick up, and especially if auto sales slide (as I suspect they will), the third quarter will shock the economists who believe this economy is strong and getting stronger.

For more of Mish's insights and opinions on markets in the US and across the globe, follow this link to Mike Shedlock’s blog.  

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