The fallacies of GDP

I'll give you the Cliff notes version.  Gross Domestic Product calculations do not accurately measure a nation's economic growth.  It's, at best, a measure of monetary inflation.

https://www.goldmoney.com/research/analysis/the-fallacies-of-gdp

Here Is The Reason For The "Surge" In Q3 GDP

http://www.zerohedge.com/news/2014-12-23/here-reason-surge-q3-gdp

Click on Image to Enlarge

Summing It All Up In 1 Surreal Chart

http://www.zerohedge.com/news/2014-11-22/summing-it-all-1-surreal-chart

GDP Disaster: Final Q1 GDP Crashes To -2.9%, Lowest Since 2009, Far Below The Worst Expectations

http://www.zerohedge.com/news/2014-06-25/gdp-disaster-final-q1-gdp-crashes-29-worst-2009-far-below-worst-expectations

Hookers And Blow: How Changing The Definition Of GDP Officially Jumped The Shark

http://www.zerohedge.com/news/2014-05-22/hookers-and-blow-how-changing-definition-gdp-officially-jumped-shark

German GDP vs. Deutsche Bank Derivative Exposure

Gee, nothing here to worry about.

Why Are Americans Driving Straight Into The Non-Recovery (And 800 On The S&P)?

http://www.zerohedge.com/news/2013-06-09/why-are-americans-driving-straight-non-recovery-and-800-sp

Total Debt + Equity = USA Bubble #1

http://www.zerohedge.com/news/2013-03-03/total-debt-equity-usa-bubble-1

Kyle Bass Interview

http://youtu.be/t7Si3XTl6zQ

"There Was No Increase In The Standard of Living Since 1997" - Lacy Hunt

http://youtu.be/4FnSULxtcSw

$99 Oil For 11/11/11

http://www.zerohedge.com/news/99-oil-111111

Q2 GDP 1.3%, Gold Surging On Imminent QE3 Resumption

I'll add the USDollar tanked on such "unexpected" news of a stagnant economy.

http://www.zerohedge.com/news/and-scene-q2-gdp-13

A simply unprecedented miss in Q2 GDP well below the consensus range, with the official number printing at 1.3%, giving it upside room for revisions in case QE3 does not pass, although at this point it is more than obvious that this number is goalseeked to give Bernanke the carte blanche to start more easing any second. This number follows an epic revision to prior data, with Q1 plunging from 1.9% to 0.4%. The GDP internals were simply appalling: Personal Consumption tumbled from 2.1% to 0.1%, on expectations of 0.8%! The US consumer is dead despite not paying mortgage payments. Lastly, US PCE Core printed at 2.1% on expectations of 2.3%. As we have been expecting since December, the US is on the verge of a triple dip recession within the bigger depression. With a deadlocked Congress, the Fed has no option but to do another monetary stimulus as seen by the surge of gold to near record highs on the data in the $1.625 range and the implosion in the USDCHF to fresh all time lows.

Something More Important than the Debt Limit

http://www.fgmr.com/something-more-important-than-the-debt-limit.html

Morgan Stanley Slashes Q1 GDP To 1.5%; Next Up - Wall Street Starts Cutting 2011 EPS

So much for the alleged "recovery" all the cheerleaders were touting last year.

http://www.zerohedge.com/article/morgan-stanley-slashes-q1-gdp-15-next-wall-street-starts-cutting-2011-eps

Crude Passes $91, As $100 Billion In US GDP Is Wiped Out In Minutes

http://www.zerohedge.com/article/crude-passes-91-100-billion-us-gdp-wiped-out-minutes

I've read every $1 price increase in a barrel of oil causes a 0.3% reduction in trade.  With the US economy hovering around $14 trillion, GDP is reduced $84 billion with every $1 increase in a barrel of oil, which is in the ball park of $100 billion, as stated in this article.

The take-away message is that quantitative easing (or printing money out of thin air) induces price inflation, which is counterproductive for economic stimulation.

Further job losses may spur quantitative easing

This is what I have been predicting all along: another round of quantitative easing due to a non-existent economic recovery, despite incessant cheerleading by government economists to the contrary.

http://www.guardian.co.uk/business/2010/aug/06/us-jobs-fall-double-expected

The sharp drop in jobs, which follows news of slowing economic growth in the US, is likely to prompt discussions at the Federal Reserve over implementing more quantitative easing – a way of pumping money into the financial system. The central bank's Federal Open Market Committee (FOMC) meets on Tuesday and Fed chairman Ben Bernanke has already hinted to markets that its programme of asset purchases could be resumed.

"The big picture is unfortunately that the downtrend in US economic growth is once again obvious, and these figures will probably do little to deter the FOMC from ultimately implementing fresh stimulus in the near future," said Nick Beecroft at Saxo Bank.

"I'd expect them to reinstate a quantitative easing programme - buying either US Treasuries or mortgage-backed securities - either at next week's meeting, or more likely at the following meeting on 21 September."

Goldman Sachs is now in the same camp, predicting QE 2.0 will be announced in Tuesday's FOMC meeting. They also lowered their forecast for GDP growth for 2011 from 2.5% to 1.9%, and raised their estimate for the unemployment rate from 9.7% to 10%.

http://www.zerohedge.com/article/goldman-explains-imminent-launch-1-trillion-qe-2-muses-dreaded-double-d

Art Cashin: Fed is walking a tightrope

http://www.zerohedge.com/article/art-cashin-fed-walking-tightrope-hurricane-and-other-observations

While we are seeing the headline numbers are pretty bad, behind the headlines there are some equally disturbing numbers. The government, we are hearing, because of tight budgets, people are being asked to take 1, 2 or even 3 furloughs a week without pay. That's wage deflation, and that's gonna put a strain on things: consumers are going to hold back.

The layoff seem to be slowing because business was taking the other approach. If you want to stay working I am going to have to cut your salary and/or your benefits.

Small businesses account for 50% of our GDP, they account for 60% of new hiring. We are not seeing new hiring because small businesses are not buying into this. So the recovery has not hit main street yet. If you ask small businesses why aren't you borrowing, their answer is "send me a customer, don't send me credit."

We've had more and more signs of potential deflation and the Fed is terrified of that...They've got to come up with something inventive, something as they call it, 'new quantitative easing.' And yet that brings the concern if they do something that is dramatically different, will people say 'What do they know that we don't know? What is the big cause of this?' So the Fed is walking a tightrope in a hurricane and it's going to be tough."

More federal debt doesn't help economic growth

http://www.zerohedge.com/article/are-we-keynesian-outlier-event-kick-started-us-recoveries-no-longer-justify-their-price-debt

US debt bomb

Keep clicking on the chart to enlarge. That's what Ben Bernanke keeps doing--clicking on his computer keystroke, creating trillions in debt each time.

That's $60 trillion in debt and unfunded promises. US GDP is $14 trillion.

This is why our financial system is in trouble. It is not just Greece that is getting "greeked."

Bud Conrad on sovereign debt

His notes:

We have gone through 3 of 4 predictable ordered phases:

1) Credit Bubble (everywhere, even subprime);

2) Credit Crisis from the bubble burst;

3) Massive Bailout, with the government absorbing the bad credit going into debt to lift the collapsing private sector, keep politicians in power, and support industries slopping at the government trough;

Leaving us with one more logical extension:

4) Currency Crisis. The massive government debt can't be paid off, confidence in the dollar will weaken more, and the eventual result will be repudiation of the debts that can't be paid. That is the step that comes after the Banking/Financial/Credit Crisis.

In our case, it is assured by the accumulated trade deficit on top of the government deficit. I was trying to give some parameters about that toward the end when Brian was asking for a time frame. The fact is that I don't know when, but I'm confident it will happen; in part because no one is worried about it.