Friday, July 31, 2009

GDP On Life Support

A vacation-abbreviated post on 2Q GDP.

The short version: "The US economy is on life support administered by the federal government."

The longer version can be deduced from the following table, setting forth the quarter over quarter percent changes at annual rates. Click to enlarge..

Second Quarter US Real GDP, Percent Changes
From Previous Quarter At Annual Rates (BEA)

24 comments:

dmsteidl said...

Hell,

Minus all of the federal spending, what would the GDP quarterly results be? Better or worse than the revised -6.4% of Q1-2009?

Hellasious said...

Total govt. added 1.12% to GDP in the 2Q. If it was the same as 1Q (-0.52%)then total GDP would have been -2.64%. Still better than 1Q, which however was just revised down from -5.5% to -6.4%.

All should take a detailed look at the GDP release at BEA'a site. It's NOT pretty.

Edwardo said...

Yes, and that's why the dollar broke down severely today and gogogogold had a robust move up. The government is the only thing growing presently, and prospectively there will be a lot more where that came from, at least according to FX traders.

I can almost hear the sound of Ben's helicopter warming up off in the distance.

marcus said...

Very Interesting,

"Real personal consumption expenditures decreased 1.2 percent in the second quarter, in contrast to an increase of 0.6 percent in the first. Durable goods decreased 7.1 percent, in contrast to an increase of 3.9 percent.

National defense increased
13.3 percent, in contrast to a decrease of 5.1 percent."

Guns but decreasing butter. Show me what a country spends its money on and I'll tell you their values.

Joe said...

The only government growth we are seeing is based on the illusion of the printing press. This week's auctions were a total failure.

The multi-trillions pledged but not funded are also an illusion We are now very close to a major economic rout, one in which the masses will finally realize, we are so screwed.

Joe M.

yoyomo said...

With GDP growth in the good old US of A stalling, it's good to see the mayors of New Jersey teaming up with Syrian rabbis to boost the velocity of money circulation between the Greater New York metropolitan area and Israel while busy working so hard to solve the shortage of donor organs.

Debra said...

Uhhhhhh.....
The U.S. economy is on life support administered by the federal government...
Does that mean we're COMMIES now ?

marcus said...

Its called "inverted totalitarianism" and Chris Hedges describes it well:
http://www.youtube.com/watch?v=0eZ6PeoBPyI

Communism for the corporations.

Debra said...

Marcus, I didn't watch Chris Hedge's youtube presentation, but read a brief article he wrote about inverted communism on violet planet, or some site to that effect.
Once again, I find the American left in cloud cuckoo land considering the state of the left in Western European countries. The Socialist party in France, following the Communist party, has sunk to the bottom of the ocean in terms of presenting political alternatives, after YEARS AND YEARS of beating the conservative right at its own ideology.
Hedges is TOO pessimistic.
Pessimism breeds... more pessimism, and particularly, it results in impressive blinders that prevent its tenants from seeing the alternative constructive forces in society that are at work, sometimes on a small scale.
I suggest, as I often suggest here, that you read "Small is Beautiful". Schumacher's revolution is ALREADY at work, because in human life, you cannot separate out "good" from "evil";
Hedges is naïve in citing his illustrious prophets. William Blake was prophesying a hell of a long time BEFORE Noam Chomsky.
And... the religious right has its own positive role to play in all of this. Patience. Not inactivity, but patience, Marcus.
You're right about dialogue, but... that's what we're doing isn't it ? ;-)

OkieLawyer said...

Off topic, @Thai:

In relation to something we talked about in relation to fractals (Pareto distributions of wealth):

How Citibank makes kids obese

marcus said...

Debra, Too bad they didn't have you in pre-war Germany, your optimism and patience could have won the day.

There are forces in this world and trends in cultures that are beyond our control. It is good to know what you control and what you don't. I have relatively no power against the omnipresent media machine in this country, and who are the interests behind this power? Certainly not the citizens.

Hedges is a realist not a pessimist. Hedges provides a much needed service, he identifies the problem and defines it. What do you do with this information? Work on solutions.

I'm not going to read "Small is Beautiful" to respond to your post, but if recent technological history is any indication "Big is here and Growing". You think China is going to stop shipping flat-screen TVs to the USA anytime soon? Where are you writing from by the way? If I sent you $100 could you Fedex me a nice little cheese sampler? Think that service will disappear?

Your criticism of the left in this country is amusing. The Left in political power, for one example, is trying to reform a disgraceful health care system against the withering attacks of the forces mentioned above. The only criticism I have against the political left is that they are doing a poor job of framing the issue. It is a losing battle though, it is a fight to frame reality, and we lost that battle--reality is gone--a vestige of people that value literacy.

Propaganda is king and the Republicans know this. The left is fighting is fighting an irresistible force, another disadvantage of not knowing the arena you are playing in. I suggest they read Hedges and play by the new arena rules.

Debra said...

You and Hedges are pessimists, Marcus.
I'm glad I amuse you...
I wonder what kind of madness collectively seems to be driving the planet today ?
My other Internet forum had equally negative, inflammatory tones to it too.
I know, I know, Marcus, I'm generalizing.
To amuse you further, why not go take a look at Richard III, the eve of the battle, when Richard sees all his ghosts ?
Kind of like that scene.
Personally, Marcus, I prefer to see the world through the eyes of the Duke of Richmond.
And that was a cheap shot about Nazi Germany, by the way. YOU weren't around then to witness, I think...

marcus said...

I apologize for the remark about Germany. I don't want to fall into the trap of devolution to the Nazi reference. It was a bit inflammatory but was used to emphasize a point--there are irresistible forces and trends in the world that we have no control over.

Seems you are hiding in days of literature past and refuse to talk about the issues. A pessimist am I? I don't think so. I find this world more fascinating all the time and the possibilities immense. I love technology and science and have faith in the human spirit. I believe Americans will work until they pay off all the gambling debts of Wall Street. I doubt we will have a violent revolution any time soon in this country (bad for business). Optimism abounds!

I just think the evidence shows our state is headed for a hard wall and its unavoidable. Why? Not to Bohr, but I think there are practical norms of truth and justice that involve an ability to deal with uncertainty and complexity--an ability we are losing.

Thai said...

Okie, thanks for the link!

This issue of obesity really is quite serious and I have seen staff get quite upset about this kind of "child abuse" before. But I have never heard of anyone actually pursuing it.

... I do wonder if there is (subconscious?) racism at play here? This story kind of reminds me of when South Carolina started going after pregnant women with drug screens positive for cocaine but never once tested for alcohol even though alcohol intoxication can be far worse for the fetus at times.


re: correlation between income inequality and overall societal health.

This issue is actually fairly well known in health care circles. The original publications in this issue got tremendous press a number of years ago.

I will say your broadcaster DOES NOT understand the issue very well. I will see if I can post you a few links if I get a moment and find some stuff, it has been a while since I read up on this. Though I would suggest you be careful about correlation and causation.

As one way of thinking about this issue: if you combine all European countries together into "one block" with a population slightly larger than the United States of America, then income inequality of that European block is far greater than it is in America. Yet life expectancy for that more unequal "block" is still superior to America.

So while I do not mean to belittle the relationship between health and income inequality, it is far more complex than your announcer has stated.

If you are interested,
look at the following map of white male mortality
.

In fact, oddly enough, there is a rather interesting thread running on gene expression on just this topic right now if you are interested.

Anyway, I hope you are well

Debra said...

Thanks for the link, Okie, that was REALLY interesting.
Some observations :
I keep harping on the numbers problem, and that they are going to bring us down, and here it is in this videoclip which touts itself as analysis.
Numbers, numbers, numbers, the "pure, raw data".
As though those little buggers could say something on their little old lonesomes that WE don't MAKE them say...
The problem with analyses like these, and this is going to make y'all scream, is that they are basically finger pointing. The goal : to find and PUNISH the criminal. To assign responsibility and then punish in consequence. Well, sometimes you have to choose what you want : PUNISH or get on with things. It's kind of like being right : what do you prefer, BEING RIGHT, or entering into dialogue with your "neighbor". (Yeah, Marcus, I have an unfortunate tendancy to chest beat when I feel that I have made a point, mea culpa...) And there are times when being right, and JUSTICE, and all that definitely get in the way of healing, and getting on with things.
The hammering of the word "inequality" made me think," poor guy, once again he has missed the point". Probably the MOST EQUAL societies Europe saw (well, Eastern Europe were the COMMUNIST ones. Yeah, well, Communism is just not the end of the world. I happen to think that it is somewhat a Casper Milktoast ideology that, similar to our Western societies at this time, wants to wipe the butts of its citizens, but every disadvantage has its advantage.
The major problem with a society that devotes its social time and energy to finding and punishing is that, well, yes, it lets the individual, and his/her responsibility in the whole schmilblik, off the hook.
So much easier to point the finger than to sit down and evaluate what WE as INDIVIDUALS can be doing about all of this. Now THAT takes energy and creativity...

marcus said...

Debra,

So we should just "get on with things" forgive and forget. Don't indulge in evil retribution or punishment. There are practical reasons why this is a bad idea. History is filled with precedents of chronic injustice and oppression of citizens leading to unseemly scenes.

Shall we wait till the point where "off with their heads" is chanted by the mobs. Should we tell the perpetrators of the financial collapse "its OK , no real harm done, we'll just work a little more and pay more taxes to clean up your mess" ? Should we allow ratings agencies to get paid to falsify ratings?

The practical reasons: punishment is to give negative inducement to the potential perpetrators. I'm sorry Bernie Madoff is going to rot in a prison cell, but it is good he is there for this purpose. To show the citizens that there is justice and that we will go after people that steal from them. If we don't the citizens may dish out their own justice. You don't need any historical reminders of what this looks like.

We also let the business leaders know their actions have consequences and mere exposure will sometimes be enough, will lead to destruction of their reputation and migration toward more trustworthy firms. Transparency is increased which increases efficiency.

Thai said...

I am on Marcus' side on this one. Madoff and Mozilla need to rot in jail.

Debra said...

Yeah, well, 20 years' experience in psychoanalysis taught me that deterrence does NOT work.
Maybe it makes the bulk of the citizens feel better, (that's what scapegoating is all about anyway) but I am STILL in favor of ideologies that appeal to the best in us, and not the worst.
I can tell you guys don't go back past the 1970's...
Your slips are showing.
I wrote my college president a letter last April telling him that I was no longer on the same planet as 99 Americans out of a hundred, and I will reiterate this.
Thank God that being an expatriate has preserved me.
Don't talk to me about denial, Marcus. I see what you're seeing, I'm just not REACTING the way you are.

yoyomo said...

The reason why lower incomes in Eastern Europe don't significantly lower health statistics in those countries is precisely because they have internal equality; a little bit of money buys alot more health care because everything costs less than in a richer country. That just reinforces Hartmann's thesis and you can't lump disparate units into one large statistical aggregation.

You're making Hartmann's point for him if you stop to think about it for a moment.

yoyomo said...

Debra,
Deterrence has been shown to work alot more effectively for white collar criminals than street criminals because:

1) They have alot more to lose

2) They are not nearly as hard pressed as a street criminal; need is a more pressing motivator in the face of grave danger than idle greed.

Thai said...

Yo, making a fractal argument!

I am impressed- kudos on a keen observation. ;-)

As I said before "while I do not mean to belittle the relationship between health and income inequality..."

Let me be even clearer: the correlation between societal wealth inequality and overall societal health outcomes is very strong. The data on this is quite strong.

And again, correlation is not causation.

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Anonymous said...

Debra,

They're called blinkers, not blinders.

Debra said...

Marcus, I will say to you what I have already said to Thai.
I am NOT proposing solutions to these problems on the scale of society, I am proposing them on the level of the individual.
There is a world of difference.
I think that there are towns in Sweden which have got rid of traffic lights. Things work better with fewer rules and regulations, particularly when everyone isn't spending his or her time harping on rules and regulations.
This may sound unbelievable to you, but just think :WHY does this sound so unbelievable to you ?